The National Bank of Ukraine (the NBU) has specified the requirements to foreign currency LCR for banks where ratio of liabilities denominated in foreign currencies to total liabilities does not exceed 5%.
Such banks continue to calculate the foreign currency LCR for supervision purposes, however, they will not be obliged to comply with the ratio at 100%.
Such approach will relieve the regulatory burden for banks that have no operations in foreign currencies.
The specified requirements to the foreign currency LCR takes into account Basel III recommendations and European laws.
The decision was approved by NBU Board Resolution No. 21 On Amendments to the Instruction on the Procedure for Regulation of Bank Activities in Ukraine dated 19 February 2020, that enters into force on 20 March 2020.
For reference:
The liquidity coverage ratio (LCR) sets the minimum liquidity level required to cover the estimated net cash outflow within 30 days, including under a stress scenario.
Currently, the LCR level is set for all currencies in total and for the group of foreign currencies separately at 100%.