Morgan Stanley’s LCR suffers in Q3 on rise in cash outflows

Projected secured wholesale funding outflows surge $10.3 billion

Morgan Stanley’s liquidity coverage ratio (LCR) dipped the most among big US banks in the third quarter of this year.

The New York-based lender saw its LCR drop 14 percentage points to 140% in the three months to end-September.

The fall was caused by an increase in projected net cash outflows (NCO), which make up the denominator of the ratio. These climbed $12 billion (10.6%) quarter on quarter, far outpacing the growth of high-quality liquid assets (HQLA), which make up the ratio’s numerator

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