Objectives On completion of this tutorial, you will be able to:

• Recognize the role of liquidity gap analysis and cash flow forecasting in assessing liquidity risk
• Identify the various ratios that banks use to measure liquidity risk such as the liquidity coverage ratio (LCR) and net stable funding ratio (NSFR)
• Recognize various key issues in liquidity risk measurement

Tutorial Overview To ensure that a bank can meet all obligations on a daily basis, under both normal and stressed conditions, a variety of tools and techniques are used to assess, measure, and monitor liquidity risk. This tutorial describes many of these tools and techniques, including liquidity gap analysis, cash flow forecasting, and ratios such as the loan/deposit ratio, liquidity coverage ratio (LCR), and net stable funding ratio (NSFR). Prerequisite Knowledge Liquidity Risk - An Introduction Tutorial Level: Intermediate Tutorial Duration: 60 minutes