When a bank is able to meet their obligations, such a concept is called the liquidity of the bank.Bank liquidity is dependent on the degree of risk of operations.That is, the more high-risk assets on the balance sheet of the bank, the less the bank's liquidity.For high-risk assets include, for example, long-term investments of any bank.Less risky assets include cash in bank notes.Creditworthiness is also very strong effect on the liquidity of the bank, including the timely repayment of loans.
And yet, the bank's balance sheet liquidity is dependent on the structure of liabilities of balance.For example, demand deposits can be obtained by investors at any time, and time deposits made by banks for a longer time.Therefore, the bank's liquidity could drop significantly if the increase the share of demand deposits and lower the proportion of fixed-term deposits.On the level of liquidity may also affect such factors as reliability of loans and deposits, which have been received from other credit institutions bank.
Assessing the solvency and liquidity of the bank, you can determine how the bank operates.And to assess possible by the use of special indicators that reflect the ratio of assets and liabilities, and asset structure.At the international level, use special liquidity ratio is the ratio of assets and liabilities.Liquidity indicators in different countries may have different methods of calculation and title.It all depends on what each country has its own practices and traditions.To evaluate the liquidity of the bank, it is necessary to apply the coefficients of the medium and short-term liquidity.Some banks liquidity is determined by the rate of the banking legislation and other established bodies of currency and banking supervision.The level of ability of the obligations of the bank is determined through comparison with established norms and the value ratio of the bank.
bank's liabilities distinguish potential and actual.Potential off-balance sheet transactions denominated passive, for example, issued by the bank guarantees.Also, to the potential off-balance sheet liabilities include active opertsii example of the letters of credit.In real commitment may include a bank's balance sheet, which is expressed in the form of deposits and urgent demand, lenders funds and borrowed funds.To fulfill these obligations can serve as sources of funds, which are expressed in the balance of cash on hand, assets are transferred into cash and other sources.The use of data sources, the bank should not be accompanied by losses.
bank's liquidity can be defined as a dynamic state, which reflects the ability to meet their obligations, directly to depositors and creditors due to the fact that manages its own assets and liabilities.Solvency is organized for a specific date, in contrast to the liquidity, for example, when the accrued employee salaries, or when you need to pay taxes to the budget.The ratio between solvency and liquidity of the bank leads to such a situation, the bank can not fulfill its payment obligations and can remain liquid.A loss of liquidity leads to systemic insolvency.This concept may mean as the inability of the bank to find sources to pay off the debt and its obligations in the internal structure, and inability to bring to maturity of liabilities other external sources.
