Liquidity management

The LLB Group has in place robust strategies, policies, processes and systems that enable it to identify, measure, manage and monitor liquidity risk. The internal liquidity adequacy assessment process (ILAAP) is set down in the internal regulations and guidelines and is reviewed and revised annually.

Within the framework of the ILAAP, the liquidity coverage ratio (LCR), as a binding regulatory liquidity reference figure, represents a material indicator both for liquidity risk assessment as well as liquidity risk management. At the end of 2018, a regulatory lower limit of 100 per cent was applicable for the LLB Group. The minimum requirement ensures that credit institutions can cover their liquidity requirements in the case of a liquidity stress scenario within 30 calendar days. With an LCR of 148 per cent (2017: 126 %), the LLB Group’s ratio was substantially higher than that required under the regulations.