Central Bank of the UAEchapter by chapter

Article 2 (items 02-04)Board Responsibility and Risk Tolerance

The board of a bank holds ultimate responsibility for liquidity risk, sets its liquidity risk tolerance, and requires at least one board member with detailed liquidity risk understanding; senior management must operate within that tolerance and report compliance.

Article 2 (items 05-08, 12)Liquidity Risk Management Framework

Banks must price liquidity risk into products, maintain systems to identify and control liquidity risk, diversify funding, and apply transfer pricing reflecting actual funding cost.

Article 2 (items 09-11)Liquidity Stress Testing and Contingency Funding Plan

Banks must run regular internal liquidity stress tests, use results to adjust strategy and contingency funding, report scenarios to the Board, maintain a formal contingency funding plan, and hold adequate unencumbered high quality liquid assets.

Article 3-4Eligible Liquid Assets Ratio (ELAR)

Banks must hold eligible liquid assets at all times equal to a Central Bank-set percentage of total liabilities, with caps on 0%-risk-weight public sector and foreign sovereign debt.

Article 3, 5Liquidity Coverage Ratio (LCR)

Banks approved to adopt the liquidity coverage ratio must hold high quality liquid assets covering total net cash outflows over a 30-day stress, minimum 100%.

Article 3, 6Net Stable Funding Ratio (NSFR)

LCR-approved banks must comply with the net stable funding ratio from 1 January 2018, while banks not approved to move to it remain subject to the loans to stable resources ratio.

Article 7Liquidity Reporting

Banks must submit liquidity reports to the Central Bank at the frequency and in the templates set out in the Guidance Manual, using contractual data without behavioural assumptions.