m1.txt

14 September 2018
TO: ALL AUTHORISED DEPOSIT-TAKING INSTITUTIONS (ADI)
AGGREGATE RESULTS ON THE COMMITTED LIQUIDITY FACILITY
The Australian Prudential Regulation Authority (APRA) is today releasing aggregate results
on the Committed Liquidity Facility (CLF) established between the Reserve Bank of Australia
(RBA) and certain locally incorporated ADIs that are subject to the Liquidity Coverage Ratio
(LCR).
APRA implemented the LCR on 1 January 2015. The LCR is a minimum requirement that
aims to ensure that ADIs maintain sufficient unencumbered high-quality liquid assets (HQLA)
to survive a severe liquidity stress scenario lasting for 30 calendar days. The LCR is part of
the Basel III package of measures to strengthen the global banking system.
In December 2010, APRA and the RBA announced that ADIs subject to the LCR will be able
to establish a CLF with the RBA. The CLF is intended to be sufficient in size to compensate
for the lack of sufficient HQLA (mainly Australian Government Securities and securities issued
by the borrowing authorities of the states and territories) in Australia for ADIs to meet their
LCR requirements. ADIs are required to make every reasonable effort to manage their liquidity
risk through their own balance sheet management before applying for a CLF for LCR
purposes.
Committed Liquidity Facility for 2019
All locally incorporated LCR ADIs were invited to apply for a CLF amount to take effect on
1 January 2019. All fifteen ADIs chose to apply. Following APRA’s assessment of applications,
the aggregate Australian dollar net cash outflow (NCO) of the fifteen ADIs was estimated at
approximately $381 billion. The total CLF amount allocated for 2019 (including an allowance
for buffers over the minimum 100 per cent requirement) is approximately $243 billion.
($ billion) 2015 2016 2017 2018 2019
Total forecast NCO 410 402 400 387 381
Available AGS and semis 175 195 220 226 225
Total CLF made available 275 245 223 248 243
Yours sincerely,
Sean Carmody
Executive General Manager
Risk & Data Analytics Division