The Australian Prudential Regulation Authority (APRA) today released a consultation package on the proposed publication of liquidity statistics for authorised deposit-taking institutions (ADIs).
APRA proposes to expand the current statistics published in the Quarterly Authorised Deposit-taking Institutions (ADI) Performance publication to include relevant information on the liquidity of ADIs. APRA proposes to introduce liquidity statistics for banks, and expand the existing liquidity statistics published for credit unions and building societies.
APRA invites submissions on the proposal by 30 March 2016. The consultation package can be found on the APRA website at: www.apra.gov.au/adi/PrudentialFramework/Pages/Consultation-on-the-publication-of-ADI-liquidity-statistics.aspx
Of most interest, and welcome, is the Liquidity Coverage Ratio (LCR).
APRA does not currently publish any statistics on LCR ADIs in QADIP. Under the LCR requirements that came into effect on 1 January 2015, LCR ADIs are required to maintain a sufficient level of unencumbered high quality liquid assets (HQLA) to meet their liquidity needs for a 30 calendar day period under a severe stress scenario. Absent a situation of financial stress for locally-incorporated LCR ADIs, the value of the LCR must not be less than 100 per cent5.
The LCR is calculated as the percentage ratio: Stock of high-quality liquid assets / Total net cash outflows over the next 30 calendar days
APRA proposes to publish aggregate LCR statistics each quarter in QADIP. The statistics would include the components of the LCR: HQLA and other qualifying LCR liquid assets. Expected cash outflows and cash inflows under the LCR stress scenario would also be published.
APRA also proposes to publish statistics at the ADI segment-level for: banks (as well as major banks, other domestic banks and foreign subsidiary banks sub-segments). There are currently no credit unions or building societies subject to the LCR regime, but should this change APRA would include LCR statistics for these segments subject to meeting confidentiality obligations.
APRA proposes to publish statistics on a Level 2 consolidation basis from December 2014 reference period onwards, commencing in the March 2016 edition of QADIP. APRA does not propose to publish statistics for the 30 June 2014 and 30 September 2014 quarters, as the underlying data were submitted on a ‘best endeavours’ basis.
