RBI Revises Liquidity Coverage Ratio (LCR) Framework to Strengthen Banking Liquidity Management. Banking & Finance | Dated: 24 Apr 2025 On April 21, 2025, the Reserve Bank of India (RBI) announced key amendments to the existing Liquidity Coverage Ratio (LCR) framework. 🎯 Key Highlights: - These amendments will be applicable to all Commercial Banks, excluding Payments Banks, Regional Rural Banks (RRBs), and Local Area Banks (LABs). - To ensure a smooth transition, RBI has provided sufficient time for banks to align their systems with the new LCR computation standards. The revised instructions will come into effect from April 01, 2026. 💡 Other Important Facts: (i) Banks will now be required to assign an additional 2.5% run-off factor on retail deposits enabled with internet and mobile banking (IMB) facilities. (ii) As a result, the stable retail deposits with IMB facilities shall carry a 7.5% run-off factor (up from the earlier 5%). (iii) The less stable retail deposits with IMB shall now carry a 12.5% run-off factor (up from the earlier 10%). These changes aim to enhance the accuracy and resilience of liquidity risk management practices across the banking sector. 📚 Test Your Knowledge: Which regulatory body has recently amended the Liquidity Coverage Ratio (LCR) framework applicable to commercial banks in India? Correct Answer: RBI 🚀 Quick Recap: About RBI Governor : Sanjay Malhotra Headquarter : Mumbai