The National Bank of Ukraine (NBU) has approved the introduction of the mandatory liquidity requirement – liquidity coverage ratio (LCR) from December 1, 2018, the central bank has reported on its website.

The respective decision is approved by NBU Board resolution amending the rules of regulating activities of banks in Ukraine and resolution No. 732-rsh amending the rules of calculating liquidity coverage ratio (LCR). The documents will take effect on December 1, 2018.

The initial minimum requirement for LCR is set at 80%. Then it will be increased step by step in line with the following schedule: from June 1, 2019 – to 90%, and from December 1, 2019 – to 100%.

Banks will be required to calculate LCR on a daily basis starting December 1, 2018. The value of the LCR standards will be defined as a 30-day moving average. Thus, the first reporting date for LCR standards was determined December 31, 2018.

The LCR standard is set for all currencies, as well as separately for a group of foreign currencies. Banks will also calculate LCR in hryvnias, but the National Bank does not determine its minimum required value.

"The decision of the board takes into account the results of the LCR test calculations, which were conducted from June 1, 2018. In addition, the proposals of banks expressed during a number of meetings of NBU experts and representatives of the banking community were taken into account. In turn, the schedule developed by the NBU will allow banks to complete the preparation for work in the conditions of new liquidity requirements with comfort," the NBU said.

From January 2019, the National Bank will begin publishing information on the implementation of LCR in the context of banks in the same way as today data on the implementation of other standards by banks are published.