The Federal Reserve has proposed to include conventional mortgages under ‘highly liquid assets’ for liquidity coverage ratio (LCR) purposes.

“The definition of highly liquid assets would ensure that the assets in the liquidity buffer can easily and immediately be converted to cash with little or no loss of value," the Fed stated. "Thus, cash or securities issued or guaranteed by the U.S. government, a U.S. government agency, or a U.S. government-sponsored entity are included in the proposed definition of highly liquid assets.”

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