But with the onset of the financial crisis, coverage was far less than adequate. In New Zealand, in 2010, the central bank introduced two liquidity ratios to increase banks’ liquidity buffers and a core funding ratio to ensure banks were holding a higher percentage of more stable liabilities such as retail deposits and wholesale loans maturing in more than a year.
These requirements were tightened again in 2013. They have met with success in as much as banks responded by changing their funding structures to meet the new requirements even before they were formally introduced.