Fed Proposes New Rule on Liquidity Reporting

The Federal Reserve today proposed a rule specifying how large banking organizations must make quarterly public disclosures of their liquidity coverage ratios.

Under the proposed rule, institutions subject to the LCR would be required to disclose their consolidated LCR calculations, based on averages over the prior quarter. Banking organizations would be required to post them prominently on their websites. In addition to disclosing the amount of high-quality liquid assets, the rule would require banking organizations to disclose information about their projected net cash outflow, including inflows and outflows from retail and derivatives. Companies would also be required to provide a discussion of their LCR results, factors behind them and significant changes.

The proposed compliance date for the disclosures is July 1, 2016 for larger institutions and July 1, 2017 for all others. Comments on the proposed rule are due by Feb. 2, 2016.