Workflow Templates: Liquidity Risk Checklist

Establish a comprehensive liquidity risk management policy.

Define roles and responsibilities for managing liquidity risk.

Develop a robust liquidity risk identification and measurement process.

Implement a system for ongoing liquidity risk monitoring and reporting.

Create a liquidity contingency plan for crisis scenarios.

Design stress testing scenarios that reflect extreme but plausible market conditions.

Incorporate both firm-specific and market-wide stress factors.

Evaluate the impact of stress scenarios on liquidity positions.

Review and update stress testing models and assumptions regularly.

Report stress testing results to senior management and relevant committees.

Determine the appropriate level of liquidity buffers based on risk appetite.

Ensure access to high-quality liquid assets (HQLA) to meet short-term obligations.

Regularly review and adjust liquidity reserves to align with changing market conditions.

Monitor the liquidity of assets held in reserve to ensure they can be quickly converted to cash.

Develop strategies for maintaining and enhancing liquidity buffers during periods of stress.

Assess the stability and diversity of funding sources.

Identify and mitigate concentration risks in the funding profile.

Develop plans for accessing alternative funding sources during liquidity stress.

Monitor and manage the maturity profile of liabilities to avoid funding mismatches.

Engage in regular dialogue with key funding providers to ensure ongoing access to funds.

Stay updated on regulatory requirements related to liquidity risk management.

Ensure compliance with liquidity coverage ratio (LCR) and net stable funding ratio (NSFR) regulations.

Prepare and submit accurate and timely regulatory liquidity reports.

Conduct regular internal audits to verify compliance with liquidity risk policies.

Engage with regulators and participate in industry forums on liquidity risk management.