Broker liquidity ratio to protect customer funds

The Bank of Russia is introducing an obligation under which brokers who use customer funds in their own interests must calculate the liquidity coverage ratio. The procedure for calculating the ratio is stipulated in the Ordinance published in the Bank of Russia Bulletin.

The Ordinance shall become effective as of 1 September 2017. Subsequently, the Bank of Russia will collect ratio calculations from professional participants during the probation period. Then, as of mid-2018 it plans to set the ratio value professional participants will have to comply with.

It is intended that compliance with the ratio will allow brokers to save customer funds and return them no later than the next business day in case of considerable cash outflow over a month.

This approach protects customer interests and guarantees greater stability in the financial market overall.