Related provisions for BIPRU 12.4.-2

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A firm must have in place robust strategies, policies, processes and systems that enable it to identify, measure, manage and monitor liquidity risk over an appropriate set of time horizons, including intra-day, so as to ensure that it maintains adequate levels of liquidity buffers. These strategies, policies, processes and systems must be tailored to business lines, currencies, branches4 and legal4 entities and must include adequate allocation mechanisms of liquidity costs, benefits
The strategies, policies, processes and systems referred to in BIPRU 12.3.4 R must be proportionate to the complexity, risk profile and scope of operation of the firm, and the liquidity risk tolerance set by the firm'sgoverning body in accordance with BIPRU 12.3.8 R, and must reflect the firm's importance in each EEA State, in which it carries on business2.[Note: article 86(2) (part) of the CRD]42
4A firm must, taking into account the nature, scale and complexity of its activities, have liquidity risk profiles that are consistent with and not in excess of those required for a well-functioning and robust system.[Note: article 86(3) of the CRD]
A firm must ensure that:(1) its governing body establishes that firm'sliquidity risk tolerance and that this is appropriately documented;2(2) its liquidity risk tolerance is appropriate for its business strategy and reflects its financial condition and funding capacity; and2(3) its liquidity risk tolerance is communicated to all relevant business lines.2[Note: article 86(2) of the CRD]425
2A firm must also have regard to existing legal, regulatory and operational limitations to potential transfers of liquidity and unencumbered assets amongst entities, both within and outside the EEA.[Note: article 86(6) of the CRD]4
BIPRU 12.4.-1RRP
2A firm must consider alternative scenarios on liquidity positions and on risk mitigants and must review the assumptions underlying decisions concerning the funding position at least annually4. For these purposes, alternative scenarios must address, in particular, off-balance sheet items and other contingent liabilities, including those of securitisation special purpose entities(SSPEs) or other special purpose entities, as referred to in the EUCRR,4 in relation to which the firm
BIPRU 12.4.10RRP
A firm must adjust its strategies, internal policies and limits on liquidity risk and develop an effective contingency funding plan, taking into account the outcome of the alternative scenarios referred to in BIPRU 12.4.-1 R.2[Note: article 86(10) of the CRD]42
BIPRU 12.4.11RRP
A4firm must have in place liquidity recovery4plans setting out adequate strategies and proper implementation measures in order to address possible liquidity shortfalls, including in relation to branches established in another EEA State.4 Those plans must be tested at least annually,4 updated on the basis of the outcome of the alternative scenarios set out in BIPRU 12.4.-1 R, and be reported to and approved by the firm'sgoverning body, so that internal policies and processes can
A firm which is an originator of a revolving securitisation transaction involving early amortisation provisions must have liquidity plans to address the implications of both scheduled and early amortisation.[Note: article 82(2) of CRD]