Requirements for eligible high-quality liquid assets.

CFR · 2024-01-01 · US · Title 12

(a) (1) The FDIC-supervised institution must demonstrate the operational capability to monetize the HQLA by: (i) Implementing and maintaining appropriate procedures and systems to monetize any HQLA at any time in accordance with relevant standard settlement periods and procedures; and (ii) Periodically monetizing a sample of HQLA that reasonably reflects the composition of the FDIC-supervised institution's eligible HQLA, including with respect to asset type, maturity, and counterparty characteristics; (2) The FDIC-supervised institution must implement policies that require eligible HQLA to be under the control of the management function in the FDIC-supervised institution that is charged with managing liquidity risk, and this management function must evidence its control over the HQLA by either: (i) Segregating the HQLA from other assets, with the sole intent to use the HQLA as a source of liquidity; or (ii) Demonstrating the ability to monetize the assets and making the proceeds available to the liquidity management function without conflicting with a business or risk management strategy of the FDIC-supervised institution; (3) The fair value of the eligible HQLA must be reduced by the outflow amount that would result from the termination of any specific transaction hedging eligible HQLA; (4) The FDIC-supervised institution must implement and maintain policies and procedures that determine the composition of its eligible HQLA on each calculation date, by: (i) Identifying its e

official document · source cfr-2024 · id 12:§ 329.22