LCR Tweak: The Magic Pill for Banking Industry's Liquidity Woes By Investing.com
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jun 11 2024
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Source: Investing.com
- Banking Sector Challenges: Banks are struggling to expand credit due to slow deposit growth, especially in wholesale segments.
- Regulatory Impact on Deposits: Current regulations make wholesale deposits less attractive due to their impact on the Liquidity Coverage Ratio (LCR).
- Proposed Solution by Bernstein: Bernstein suggests reducing the runoff factor for wholesale deposits to boost deposit growth.
- Potential Benefits of Relaxing LCR Constraints: Lowering the runoff factor could significantly improve LCR ratios and benefit banks reliant on wholesale deposits.
- Investment Outlook for HDFC Bank: Analysts project a bullish sentiment for HDFC Bank with target prices ranging from INR 1,869 to INR 2,470, indicating potential upside.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
