Which one of the following is defined as quot the proportion of highly liquid assets held by financi...........

General Studies (CHSL) Indian Economy

Which one of the following is defined as "the proportion of highly liquid assets held by financial institutions, to ensure their ongoing ability to meet short-term obligations"?

Base Rate

Cash Reserve Ratio

Statutory Liquidity Ratio

Liquidity Coverage Ratio

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Explanation:

The liquidity coverage ratio (LCR) refers to the proportion of highly liquid assets held by financial institutions, to ensure their ongoing ability to meet short-term obligations.This ratio is essentially a generic stress test that aims to anticipate market-wide shocks and make sure that financial institutions possess suitable capital preservation, to ride out any short-term liquidity disruptions, that may plague the market.