Michael West: Banks shamelessly rorting RBA’s bail-out fund

The Committed Liquidity Facility (CLF) was established in late-2011 in order to meet the Basel III liquidity reforms.

Since January 2015, those ADIs to which APRA applies the Basel III liquidity standards have been required to hold high-quality liquid assets (HQLA) sufficient to withstand a 30-day period of stress under the liquidity coverage ratio (LCR) requirement.

According to the Reserve Bank of Australia (RBA), the CLF “is required because of the limited amount of government debt in Australia, is designed to ensure that participating authorised deposit-taking institutions (ADIs) have enough access to liquidity to respond to an acute stress scenario, as specified under the liquidity standard”.

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