JERUSALEM Feb 9 Israel's banking regulator on
Sunday asked the country's banks to provide details on how they
can comply with a liquidity requirement that is part of new
global rules to strengthen banks after the financial crisis.
Israel plans to implement gradually the liquidity coverage
rule in 2015 that aims to ensure banks have enough assets that
can be converted quickly into cash. This will reflect the amount
of liquid assets a bank must hold relative to its total forecast
liquidity needs over the next 30 days under a stress scenario.
"Although the banking system in Israel displayed resilience
during the recent global crisis, we have to be smart enough to
learn from the lessons of the crisis, so that the banking system
will continue meeting the top international standards,"
Supervisor of Banks David Zaken said.
"The implementation of the liquidity part of the Basel III
Framework is an important further step toward achieving this
goal," Zaken said.
A central bank spokesman said that since the new global
rules - known as Basel III - are being implemented differently
around the world to meet local conditions, Israel is asking
banks whether they will be liquid enough to meet the
requirements and then a directive from the supervisor will be
Under the rules, Israeli banks will have to meet a 60
percent coverage by January 2015 and increase 10 percentage
points each year until January 2019, when a liquidity coverage
ration of 100 percent will be required.
Zaken has also issued a directive in which banks must hold
core capital equivalent to at least 9 percent of their
risk-weighted assets by Jan. 15. He has imposed an additional
goal of 10 percent on Israel's largest banks - Hapoalim
and Leumi - by January 2017.
All of Israel's top banks have a core capital ratio - a
measure of financial strength, 9 percent.
(Reporting by Steven Scheer. Editing by Jane Merriman)