DEUTSCHE BANK HAS CREDIBLE SHOCK ABSORBERS
Deutsche Bank has credible liquidity shock absorbers. The German lender reassured its own employees on Sept. 30, not for the first time, after reports that some hedge funds were withdrawing cash. It clearly has big problems, but a 2008-style liquidity implosion need not be one of them.Since that crisis, regulators have revamped the way they oversee bank liquidity. The centrepiece of this is the so-called Liquidity Coverage Ratio, which tests the quantity of assets a lender holds to withstand 30 days of investors pulling money in a stress scenario partly modeled on the financial crisis.