Work out liquidity coverage ratio instantly with clear inputs, formula shown and shareable results.
The liquidity coverage ratio tests whether liquid assets survive thirty days of stressed outflows. Inflows are capped at 75% of outflows, so a bank cannot rely entirely on money coming in to meet money going out.
Liquidity coverage
LCR = HQLA / (outflows - min(inflows, 75% of outflows))
Figures are estimates based on the inputs given. Bank charges, regulatory minima and market rates change and differ between institutions and jurisdictions. This is not financial advice — confirm with your bank or treasury policy.
Because in a stress the assumption that borrowers repay on time is exactly what fails. The cap forces a genuine asset buffer.
Central bank reserves and government securities primarily, with haircuts on lower-grade eligible assets.