Liquidity requirement
Regulatory obligation for banks and similar institutions to hold sufficient liquid assets and manage cash-flow risks.
Liquidity requirements ensure that regulated institutions can meet payment obligations in normal and stressed conditions. They include quantitative ratios, such as short-term liquidity coverage concepts, and qualitative duties for liquidity risk management, contingency funding and stress testing. In Switzerland, banks are subject to liquidity rules shaped by international standards and domestic supervisory practice, with stricter expectations for systemically important institutions. Liquidity protection complements capital adequacy: a solvent institution can still fail if it cannot obtain cash when needed.