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JOURNAL OF INTERDISCIPLINARY RESEARCH

of liquidity risk, the EBA issued guidelines relating to the
allocation of liquidity costs

, definitions of liquidity buffers and

counterbalancing capacity

, harmonized definitions and

templates for funding plans

, and –more directly connected with

the LCR – retail deposits subject to different outflows

. The

latter, however, serve solely for the purpose of identification of
such deposits under the delegated act on liquidity coverage
requirement, as these different outflow rates have already been
determined by the legislator

. It is worth to mention that

according to the CRR, the EBA in cooperation with the ESRB
should develop guidance on the principles for use of liquid assets
in stress situations

4 Conclusions

The harmonization of liquidity risk regulations in the European
Union was broadly aimed at providing greater transparency and
improved efficiency of banks as a result of introduction of a set
of uniform practices and regulations in the area of liquidity risk.
The idea, however right, does not work so well in practice. First
of all, there are significant delays in the legislative process,
which bring inconsistencies in the way of application of the
regulations throughout the Union, or even restrain banks from
meeting the requirements. What is more, an introduction of
every single amendment to the regulations (even those
concerning reporting obligations) is a very complex process,
which requires plenty of time, and as such creates impediments
to a smooth application of the requirements. Moreover, there are
many doubts as regards the correct interpretation of the legal
acts’ provisions, which cannot be clarified at the national level,
as it is the EBA, which is allowed to provide interpretations,
although it takes around 6 months to prepare and publish an
answer.

From the analysis provided herein, it can be concluded that the
establishment of the single rulebook has made the process of
application of the regulatory provisions very prolonged and
complicated, which creates uncertainty among banks. The
harmonization of liquidity risk regulations is progressing
gradually at the European level, although it requires years to
transform into a truly uniform and comprehensive regulatory
framework. Hopefully, however, this new regulatory framework
will prevent any possible future crises stemming from the
significant deficiencies in the liquidity risk management
strategies of banks.

Literature:

1. Directive 2013/36/EU of the European Parliament and of the
Council of 26 June 2013 on access to the activity of credit
institutions and the prudential supervision of credit institutions
and investment firms, amending Directive 2002/87/EC and
repealing Directives 2006/48/EC and 2006/49/EC, OJ L
176/338, 26.7.2013.
2. Regulation (EU) No 575/2013 of the European Parliament and
of the Council of 26 June 2013 on prudential requirements for
credit institutions and investment firms and amending
Regulation (EU) No 648/2012, OJ L 176, 27.6.2013.
3. Commission Implementing Regulation (EU) 2015/233 of 13
February 2015 laying down implementing technical standards
with regard to currencies in which there is an extremely narrow
definition of central bank eligibility pursuant to Regulation (EU)
No 575/2013 of the European Parliament and of the Council, OJ
L 39, 14.2.2015.

CEBS, Guidelines on Liquidity Cost Benefit Allocation, 27 October 2010.

CEBS, Guidelines on Liquidity Buffers & Survival Periods, 9 December 2009.

EBA, Guidelines on harmonised definitions and templates for funding plans of

credit institutions under Recommendation A4 of ESRB/2012/2, EBA/GL/2014/04, 19
June 2014.

EBA, Guidelines on retail deposits subject to different outflows for purposes of

liquidity reporting under Regulation (EU) No 575/2013, on prudential requirements
for credit institutions and investment firms and amending Regulation (EU) No
648/2012 (Capital Requirements Regulation – CRR), EBA/GL/2013/01, 6 December
2013.

Recital 14 and Article 25 of the delegated regulation (EU) 2015/61.

Recital 104 of the CRR.

4. Commission Delegated Regulation (EU) 2015/61 of 10
October 2014 to supplement Regulation (EU) No 575/2013 of
the European Parliament and the Council with regard to liquidity
coverage requirement for Credit Institutions, OJ L 11, 17.1.2015.
5. Commission Implementing Regulation (EU) No 680/2014 of
16 April 2014 laying down implementing technical standards
with regard to supervisory reporting of institutions according to
6. Regulation (EU) No 575/2013 of the European Parliament and
of the Council, OJ L 191, 28.6.2014.
7. BCBS, Basel III Monitoring Report, Bank for International
Settlements, September 2015.
8. BCBS, Net Stable Funding Ratio disclosure standards, Bank
for International Settlements, June 2015.
9. BCBS, Basel III: the net stable funding ratio, Bank for
International Settlements, October 2014.
10. BCBS, Liquidity coverage ratio disclosure standards, Bank
for International Settlements, January 2014 (rev. March 2014).
11. BCBS, Guidance for Supervisors on Market-Based
Indicators of Liquidity, Bank for International Settlements,
January 2014.
12. BCBS, Liquidity stress testing: a survey of theory, empirics
and current industry and supervisory practices, Working Paper
No 24, Bank for International Settlements, October 2013.
13. BCBS, Literature review of factors relating to liquidity
stress – extended version, Bank for International Settlements,
Working Paper No 25, Bank for International Settlements,
October 2013.
14. BCBS, Monitoring tools for intraday liquidity management,
Bank for International Settlements, April 2013.
15. BCBS, Basel III: The Liquidity Coverage Ratio and liquidity
risk monitoring tools, Bank for International Settlements,
January 2013.
16. BCBS, Revisions to Basel III: The Liquidity Coverage Ratio
and liquidity risk monitoring tools, Annex, Bank for
International Settlements, January 2013.
17. BCBS, Principles for sound liquidity risk management and
supervision, Bank for International Settlements, September
2008.
18. BCBS, Sound Practices for Managing Liquidity in Banking
Organisations, Basel, February 2000.
19. BCBS, A Framework for Measuring and Managing
Liquidity, Basel, September 1992.
20. Bonner, C., Hilbers, P., Global liquidity regulation - Why did
it take so long?, DNB Working Paper, Working Paper No. 455,
January 2015. 44 p.
21. CEBS, Guidelines on Liquidity Cost Benefit Allocation, 27
October 2010.
22. CEBS, Guidelines on Liquidity Buffers & Survival Periods, 9
December 2009.
23. EBA, Opinion of the European Banking Authority on the
Commission intention to amend draft Implementing Technical
Standards on additional liquidity monitoring metrics under
Article 415(3)(b) of Regulation (EU) No 575/2013,
EBA/Op/2015/16, 23 September 2015.
24. EBA, Opinion of the European Banking Authority on the.
Commission intention to amend draft Regulatory Technical
Standards specifying the derogations concerning currencies with
constraints on the availability of liquid assets according to
Article 419(5) CRR, EBA/Op/2015/13.
25. EBA, Opinion of the European Banking Authority on the
Commission intention to amend draft Implementing Technical
Standards with regard to currencies with constraints on the
availability of liquid assets, EBA/Op/2015/12.
26. EBA FINAL draft Implementing Technical Standards
amending Commission Implementing Regulation (EU) No
680/2014 (ITS on supervisory reporting) with regard to the
Liquidity Coverage Ratio (LCR) following the EC’s Delegated
Act specifying the LCR, EBA/ITS/2015/04, 23 June 2015.
27. EBA FINAL draft implementing technical standards on
additional liquidity monitoring metrics under Article 415(3)(b)
of Regulation (EU) No 575/2013, EBA/ITS/2013/11/rev1,
24/07/2014.
28. EBA, Guidelines on harmonised definitions and templates
for funding plans of credit institutions under Recommendation
A4 of ESRB/2012/2, EBA/GL/2014/04, 19 June 2014.

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