The EzyEducation website uses cookies to help ensure we give you the best experience.
If you continue without changing your settings, we assume that you are happy to receive all cookies on the EzyEducation website.
Please refer to our Privacy and Cookies Statement to

find out more.


Liquidity Coverage Ratio

A ratio used to ensure that financial institutions have the necessary assets on hand to meet short-term liquidity requirements. Under this standard, the banks must hold a stock of unencumbered liquid assets to cover the total net cash outflows.

Below is the formula for calculating the LCR ratio. This ratio must exceed 1 in order for the financial institution to have enough liquid assets to cover volatile liabilites and remain in a solvent position on the balance sheet.


Forgot your password?