Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/217677 
Year of Publication: 
2019
Citation: 
[Journal:] Journal of Central Banking Theory and Practice [ISSN:] 2336-9205 [Volume:] 8 [Issue:] 2 [Publisher:] De Gruyter Open [Place:] Warsaw [Year:] 2019 [Pages:] 101-128
Publisher: 
De Gruyter Open, Warsaw
Abstract: 
In December 2010, the Basel Committee on Baking Supervision introduced the liquidity coverage ratio (LCR) standard for banking institutions in response to disturbances that rocked banks during the 2007/08 global financial crisis. The rule is aimed at enhancing banks’ resilience to short term liquidity shocks as it requires banks to hold ample stock of high grade securities. This study attempts to evaluate the impact of the LCR specification on the funding structures of banks in emerging markets by answering the question "Did Basel III LCR requirement induced banks in emerging market economies to increase deposit funding more than they would otherwise do?" The study found that the LCR charge has been effective in persuading banks in emerging markets to garner more stable retail deposits. This response may engender banking sector stability if competition for retail deposits is properly regulated.
Subjects: 
Basel III
LCR
commercial banks
emerging market economies.
JEL: 
G11
G18
G19
G21
G28
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by-nc-nd Logo
Document Type: 
Article

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