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Capital and regulation

ILAAP

A bank's own process for judging whether it holds enough liquidity for all its risks, reviewed by supervisors.

The Internal Liquidity Adequacy Assessment Process is the liquidity counterpart to the ICAAP. The bank sets out its liquidity risks, its buffers, its funding plan and its stress testing, and shows that it can survive stress.

Like the ICAAP it is challenged by supervisors and feeds their view of how much liquidity the bank must maintain.

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