In many countries, regulators often set minimum liquid reserve requirements on FIs.

Question

Quizplus · Accepted Answer

This is true. Regulators set minimum liquid reserve requirements on FIs to ensure that they have enough cash or liquid assets on hand to meet their obligations to their customers and counterparties. These reserve requirements vary by country and by the type of financial institution, but they are a common tool used by regulators to promote stability in the financial system.

In Many Countries, Regulators Often Set Minimum Liquid Reserve Requirements