Featured Pathways

More pathways

Banking Essentials - Part I

This pathway will walk us through the basics of banks, starting with some of the different types and their main functions, then starting to look at the regulation faced by the banks, both before and after the Global Financial Crisis.

Greenwashing

Greenwashing is the act of distributing false information about something being more environmentally friendly than it actually is.

More pathways

Book a demo

Ready to get started?

Our Platform

Expert led content

+1,000 expert presented, on-demand video modules

Learning analytics

Keep track of learning progress with our comprehensive data

Interactive learning

Engage with our video hotspots and knowledge check-ins

Testing & certification

Gain CPD / CPE credits and professional certification

Managed learning

Build, scale and manage your organisation’s learning

Integrations

Connect Finance Unlocked to your current platform

Featured Content

More featured content

Tackling the Cost of Living Crisis

In this video, Max discusses the cost-of-living crisis currently enveloping the UK. He examines its impact on households as well as the overall economy.

CSR and Sustainability in Financial Services

In the first video of this two-part video series, Elisa introduces us to sustainability. She begins by looking at the difference between sustainability and corporate social responsibility, two terms that can be easily confused.

More featured content

Book a demo

Ready to get started?

Featured Pathways

More pathways

Banking Essentials - Part I

This pathway will walk us through the basics of banks, starting with some of the different types and their main functions, then starting to look at the regulation faced by the banks, both before and after the Global Financial Crisis.

Greenwashing

Greenwashing is the act of distributing false information about something being more environmentally friendly than it actually is.

More pathways

Book a demo

Ready to get started?

Our Platform

Expert led content

+1,000 expert presented, on-demand video modules

Learning analytics

Keep track of learning progress with our comprehensive data

Interactive learning

Engage with our video hotspots and knowledge check-ins

Testing & certification

Gain CPD / CPE credits and professional certification

Managed learning

Build, scale and manage your organisation’s learning

Integrations

Connect Finance Unlocked to your current platform

Featured Content

More featured content

Tackling the Cost of Living Crisis

In this video, Max discusses the cost-of-living crisis currently enveloping the UK. He examines its impact on households as well as the overall economy.

CSR and Sustainability in Financial Services

In the first video of this two-part video series, Elisa introduces us to sustainability. She begins by looking at the difference between sustainability and corporate social responsibility, two terms that can be easily confused.

More featured content

Book a demo

Ready to get started?

Book a demo

Ready to get started?

Level 1 and Level 2 Assets (LCR)

Level 1 and Level 2 Assets (LCR)

Glossary
Banking

Level 1 and Level 2 Assets (LCR)

Following the Global Financial Crisis, the Basel Committee on Banking Supervision drafted a range of banking standards to protect the financial system. These have been rolled out by regulators worldwide. One of these standards is the Liquidity Coverage Ratio (LCR), whose aim is to underpin the resilience in the short term of a bank’s liquidity risk profile. Under the LCR, banks are required to maintain a stock of unencumbered high quality liquid assets (HQLA) that can be converted into cash at little or no loss of value in private markets to meet their liquidity needs for 30 days under a stressed scenario. The LCR – HQLA stock divided by modelled net outflows over 30 days – must equal 100% of more. HQLA are divided into Level 1 and Level 2 assets. Level 1 assets – the highest quality – include cash, central bank reserves and securities backed by sovereign and central banks. There is no limit to the amount of Level 1 assets a bank can hold to meet its LCR. Level 2 assets are further split into 2A and 2B. Level 2A include certain government securities, covered bonds and highly-rated corporate debt securities. Level 2B assets include lower-rated corporate bonds, residential mortgage-backed securities and equities that meet certain conditions. Level 2 assets can not account for more than 40% of a bank’s HQLA stack. Level 2B assets may not account for more than 15% of a bank’s total stock of HQLA

Related terms