BoB fines banks P1m for breaching liquidity limits

“Towards the end of 2014, some banks experienced significant short-term liquidity shortages, to the extent that their liquid assets to total deposits ratio fell below the statutory prescribed limit. Consistent with the Banking Act, a monetary penalty fee of P892 263 was levied on all non-compliant banks,” said the central bank in the 2014 Banking Supervision Annual report.

The Banking Act prescribes that commercial banks are required to keep at least 10 percent of their assets in liquid form such as cash, BoB certificates and current account balances with domestic banks.