CBI Notifies Liquidity Risk Regulations

The Central Bank of Iran has officially notified the directive for “minimum requirements of liquidity risk management of credit institutions” to the banking system that was approved by the top financial decision-making body Money and Credit Council two weeks ago. The directive obliges financial institutions to regularly monitor liquidity risk and sets out fundamentals and defines corporate structures on how to manage liquidity risk. It also devises internal regulations for credit institutions and calls on them to establish a database with the aim of evaluating, supervising and controlling liquidity risk. Through the directive, the central bank also mandates credit institutions to especially consider managing liquidity risk of “important currencies”, obligates them to report each month and threatens disciplinary action in case of violation.