Funds should also be required to hold a sufficiently large share of cash and highly liquid assets to manage increased liquidity needs stemming from outflows or margin calls in periods of 3/4  BIS central bankers' speeches  stress. During the spring turmoil, increasing margin calls helped to ensure that the extraordinary market volatility did not result in concerns about counterparty risk.
At the same time, it contributed to amplify the liquidity pressures in the system for non-bank financial intermediaries in particular. This warrants further analysis to assess whether adjustments to margining practices and the related regulatory approaches are needed to reduce excessive procyclicality in initial margins.