UK proposes gold plating of liquidity risk rules

Cashflow mismatch risk framework aims to plug holes in Basel Committee's liquidity coverage ratio

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The UK’s Prudential Regulation Authority: measures are intended to update its Pillar II framework

The UK’s Prudential Regulation Authority (PRA) has issued fresh proposals to tackle liquidity risk. However, the suggestions go beyond the demands of the Basel Committee on Banking Supervision and European Union’s own supervisory frameworks – prompting complaints of unnecessary gold plating among market participants.

The UK regulator published a consultation paper on a so-called cashflow mismatch risk (CFMR) framework and other tools for evaluating firms’ liquidity risk on July 13. The proposed

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