This assignment entails Liquidity Risk management. There is also a discussion on Governance of The UK Banking Industry. Therefore, identify risk reduction recommendations.

Liquidity Risk management – Governance of The UK Banking Industry

Foremost, Liquidity risk includes unmanageable reductions or changes in funding sources. Additionally, it stems from the failure to identify or resolve changes in market conditions that affect the ability to liquidate assets quickly and lose money with minimal value. Monitoring liquidity refers to the total or total amount of liquid assets traded in the economy. (Adrian and Shin, 2008). Attempt to solve the main reason for the mismatch of bank assets and liabilities through a literature review. Poor liquidity management may lead to bankruptcy. We cannot distinguish between liquidity and solvency of banks. Sometimes, banks that cannot be repaid may be insolvent; on the other hand, banks that cannot be repaid may be insolvent. This is why the adequate performance of capital and liquidity is the main concern of commercial banks. (Good Hart, 2008).

Liquidity Risk management – Governance of The UK Banking Industry

Assignment Objectives

First, under key economic strategies and conditions, the impact of liquidity risk on bank stability.

Secondly, manage liquidity risk in the UK banking industry.

Thirdly, what regulatory measures have banks adopted to limit liquidity risk?

Fourthly, the importance of internal risk management framework for internal governance of the banking industry.

Finally, identify risk reduction recommendations.


The primary role of liquidity-risk management is to; First, prospectively assess the need for funds to meet obligations. Secondly, ensure the availability of cash or collateral to fulfill those needs at the appropriate time by coordinating the various sources of funds available to the institution under normal and stressed conditions

Detailed Instructions


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