BERLIN, July 22, 2023: The European Central Bank (ECB) has stepped up the scrutiny as it will ask the banks to provide liquidity data in a bid to ward off any risks of a financial crisis in the future, AFP reported.
“We decided to send banks, starting in September, a request for information on a weekly basis, in order to have more recent data to allow us to better monitor liquidity developments,” said Andrea Enria, the ECB supervisory chief.
“It’s a question of sending, with greater frequency, the information on liquidity that banks already send us on a monthly basis,” he added.
The data which the ECB has asked to share include the maturity of liquidity in the bank’s accounts, their counterparties and refinancing transactions.
This would help in controlling the development of “the most liquid assets and liabilities, like deposits”, Enria added.
The development came after the regional banks in the United States faced bankruptcy followed by the collapse of Credit Suisse which triggered fears of a global financial crisis.
European Banking Authority (ABE) — the regulator for the banking sector — made this recommendation in June.
Strict measures have also been adopted by the European Union to avert a financial crisis similar to 2008.