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Liquidity Coverage Ratio Calculator

Formulas

The formulas used in the calculations are:

$\text{highly liquid assets} = \text{cash and cash equivalents} + \text{marketable securities}$

$\text{LCR} = \left( \frac{\text{highly liquid assets}}{\text{expected 30-days cash outflows}} \right) \times 100$

Description

This calculator computes the Liquidity Coverage Ratio (LCR) based on the input values of cash and cash equivalents, marketable securities, and expected 30-days cash outflows. The LCR is a measure used to ensure that a financial institution has enough highly liquid assets to cover its expected cash outflows over a 30-day period in a stress scenario.

Example Calculation

Let's assume the following:

Cash and Cash Equivalents: $1,000,000
Marketable Securities: $750,000
Expected 30-days Cash Outflows: $1,500,000

Calculate the highly liquid assets:

$\text{highly liquid assets} = 1,000,000 + 750,000 = 1,750,000$

Calculate the LCR:

$\text{LCR} = \left( \frac{1,750,000}{1,500,000} \right) \times 100 = 116.67\%$

Therefore, the Liquidity Coverage Ratio (LCR) for this example is 116.67%.