{
  "title": "Assessing Liquidity Buffers in the Panamanian Banking Sector",
  "publication": "IMF Working Papers, October 14, 2016",
  "sourceUrl": "https://www.imf.org/en/publications/wp/issues/2016/12/31/assessing-liquidity-buffers-in-the-panamanian-banking-sector-44334",
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  "summary": "This paper assesses the resilience of Panamanian banks to (i) a very severe short-term, and (ii) a significant long-lasting liquidity shock scenario. Short-term liquidity buffers are evaluated by approximating the Liquidity Coverage Ratio (LCR) defined in the Basel III accord.",
  "sections": [
    {
      "heading": "Objective and Scenarios",
      "content": "- Assess resilience of Panamanian banks to:\n  - (i) a very severe short-term liquidity shock scenario.\n  - (ii) a significant long-lasting liquidity shock scenario.\n- Short-term liquidity buffers evaluated by approximating the Liquidity Coverage Ratio (LCR) defined in the Basel III accord.\n- Risk of losing a substantial part of foreign funding analyzed through a conventional liquidity stress test scrutinizing several layers of liquidity across maturity buckets."
    },
    {
      "heading": "Methods and Metrics",
      "content": "- Approximation of the Liquidity Coverage Ratio (LCR) as per the Basel III accord.\n- Conventional liquidity stress test examining multiple layers of liquidity across maturity buckets."
    },
    {
      "heading": "Key Findings",
      "content": "- About half of Panamanian banks would need to adjust their liquid asset portfolios to meet current LCR standards.\n- While most banks would be able to meet funding outflows in the stress-test scenario:\n  - A number of banks would have to use up all of their liquidity buffers.\n  - A few banks even face a final shortfall.\n- Nonetheless, most banks displaying sizable liquidity shortfalls have robust solvency positions."
    },
    {
      "heading": "Subject Areas and Keywords",
      "content": "- Subjects: Asset and liability management; Banking; Commercial banks; Financial institutions; Financial regulation and supervision; Financial sector policy and analysis; Liquidity; Liquidity requirements; Liquidity stress testing; Securities.\n- Keywords: a number of bank; bank; bank funding; Bank liquidity; banking sector; Commercial banks; funding; funding outflow; Global; illiquid bank; LCR; LCR calculation; LCR standard; liquid asset; Liquidity; liquidity gap; liquidity regulation; Liquidity requirements; liquidity shortfall; Liquidity stress testing; Liquidity stress tests; Panamanian bank; parent bank; Securities; stress scenario; WP.\n\n---\n\n Content in this bundle\n\n- Assessing Liquidity Buffers in the Panamanian Banking Sector\n  - Assessing Liquidity Buffers in the Panamanian Banking Sector (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Assessing Liquidity Buffers in the Panamanian Banking Sector (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\nSource: https://www.imf.org/en/publications/wp/issues/2016/12/31/assessing-liquidity-buffers-in-the-panamanian-banking-sector-44334"
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    "Authors: Andras Komaromi, Metodij Hadzi-Vaskov, Torsten Wezel",
    "Published: October 14, 2016",
    "Series: IMF Working Papers",
    "DOI: https://doi.org/10.5089/9781475544824.001",
    "Assess resilience of Panamanian banks to:",
    "Short-term liquidity buffers evaluated by approximating the Liquidity Coverage Ratio (LCR) defined in the Basel III accord.",
    "Risk of losing a substantial part of foreign funding analyzed through a conventional liquidity stress test scrutinizing several layers of liquidity across maturity buckets.",
    "Approximation of the Liquidity Coverage Ratio (LCR) as per the Basel III accord.",
    "Conventional liquidity stress test examining multiple layers of liquidity across maturity buckets.",
    "About half of Panamanian banks would need to adjust their liquid asset portfolios to meet current LCR standards.",
    "While most banks would be able to meet funding outflows in the stress-test scenario:",
    "Nonetheless, most banks displaying sizable liquidity shortfalls have robust solvency positions.",
    "Subjects: Asset and liability management; Banking; Commercial banks; Financial institutions; Financial regulation and supervision; Financial sector policy and analysis; Liquidity; Liquidity requirements; Liquidity stress testing; Securities.",
    "Keywords: a number of bank; bank; bank funding; Bank liquidity; banking sector; Commercial banks; funding; funding outflow; Global; illiquid bank; LCR; LCR calculation; LCR standard; liquid asset; Liquidity; liquidity gap; liquidity regulation; Liquidity requirements; liquidity shortfall; Liquidity stress testing; Liquidity stress tests; Panamanian bank; parent bank; Securities; stress scenario; WP.",
    "**Assessing Liquidity Buffers in the Panamanian Banking Sector**"
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