In addition to these steps related to capital, in 2012 the Federal Reserve began a comprehensive assessment of large banks’ liquidity. 10 We review the firms’ own liquidity stress tests, and we conduct an independent assessment of their liquidity. These liquidity exercises provide a regular opportunity for Fed supervisors to respond to evolving liquidity risks and firm practices over time.
It was because there is a need to shut it down to buy time, to delay the spread of the virus while building the country’s health capacity. Amid this challenge, the domestic banking system can be harnessed to support economic recovery. Specifically, they provide cash flow support to individual clients and micro, small and medium enterprises.