Towards a New Framework for Liquidity Risk

This paper provides an overview of the principal frameworks in place before the crisis and the current trends in bank liquidity risk management. The reassessment of management practices and techniques for identifying, measuring and monitoring liquidity risk is strictly intertwined with the process of regulatory reform in place. For these reasons the paper reviews the CEBS's proposals to fix criteria for the quantitative and qualitative definition of the liquidity buffer and the quantitative measures, and the implied changes, put forward by Basel Committee in its proposal for an international framework for liquidity risk management. Some preliminary considerations on the impact of the new regulation are proposed at the end of the document