One of the core functions of a central bank is to provide liquidity insurance, often termed the lender of last resort … (LLR) function. During and after the Great Financial Crisis (GFC) in 2007-09 central banks' role as liquidity insurers … evolved. In the aftermath of the crisis, regulation of liquidity risk in the financial sector has been tightened, and central …

The paper reports the outcome of the stress-testing of liquidity risk in the TARGET2 payment system, with the study … resilience of the system, defined as the network of its participants, and the appropriateness of liquidity levels under tightened … liquidity conditions. The scenarios analysed are based on extreme shocks to the value of collateral of different levels and …

We analyze the pledging behavior of Euro area banks during the introduction of the liquidity coverage ratio (LCR). The … requirement after the LCR introduction. We attribute the difference across banks to a preparation effect of the liquidity … LCR considers only a subset of central bank eligible assets and thereby offers banks an arbitrage opportunity to improve …