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Statutory Liquidity Ratio or SLR as it is more commonly called is the amount of liquid cash every bank has to maintain in order to meet the daily customer withdrawal demands. Whatever money we deposit with banks, they lend it out to other customers to make a profit out of it. Imagine you depositing a few lakh rupees out of your retirement corpus with a bank and visiting the bank to withdraw some money to get a gift for your grandson and the bank telling you that since the loan re-payments were not received on time, you can't take money out of your account right now? That would be bad wouldn't it?
This is exactly why banks have to maintain a SLR so that they don't have to refuse withdrawal transactions from deposit customers. It's your money and you should be able to withdraw it anytime you want.
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∙ 13y ago
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What are factors influencing liquidity of bank?
1.Statutary liquidity ratio.2.Cash reserve ratio.3.Nature of business.4.Nature of investment.5.Nature of deposit.6.Banking habit.7.General economic activities.8.Clearing house.9.Banking structure10.Existance of money market.11.Expantion 0f branches.12.Seational situatiin13.Creating adequate provisions for loans and advances.14.Management of portfolio.15.Aletrnative sources of liquidity.
What is the purpose of the liquidity ratio?
Liquidity ratios measure the availability of cash to pay debt
What is current Statutory Liquidity Ratio?
25%
What is CLR rate of bank?
cash liquidity ratio
What is the slr ratio for bank?
SLR stands for Statutory Liquidity Ratio. Statutory Liquidity Ratio is the amount of liquid assets, such as cash, precious metals or other approved securities, that a financial institution must maintain as reserves other than the Cash with the Central Bank. The statutory liquidity ratio is a term most commonly used in India.
What is current Statutory Liquidity Ratio of India as on 1st feb 2011?
statutary liquidity ration currnetly is 25%
What is the latest ratio of statutary liqidity ratio?
24%
What are factors influencing liquidity of bank?
1.Statutary liquidity ratio.2.Cash reserve ratio.3.Nature of business.4.Nature of investment.5.Nature of deposit.6.Banking habit.7.General economic activities.8.Clearing house.9.Banking structure10.Existance of money market.11.Expantion 0f branches.12.Seational situatiin13.Creating adequate provisions for loans and advances.14.Management of portfolio.15.Aletrnative sources of liquidity.
Current ratio and liquidity ratio are same?
no they are not the same. the current ratio is current assets/current liabilities. but liquidity ratio or acid test ratio is current assets - stock/current liabilities. liquidity ratio shows you how able a business is to pay off its debt when stock is taken out of the equation.
What is the purpose of the liquidity ratio?
Liquidity ratios measure the availability of cash to pay debt
An example of liquidity ratio is the?
current ratio and acid test ratio are examples of liquidity ratios'. current ratio is current asset's/ current liabilities. acid test ratio is current assets- stock / current liabilities.
What is current Statutory Liquidity Ratio?
25%
What is the financial ratio used to assess a company's liquidity?
The quick ratio which equals total assets/total liabilities Answer: Liquidity Ratios are the ratios that can be used to measure the liquidity of a company. As a rule of the thumb, all companies must have good liquidity ratios. The four main ratios that fall under this category are: 1. Current Ratio or Working Capital Ratio 2. Acid-test Ratio or Quick Ratio 3. Cash Ratio 4. Operation Cash-flow ratio
Full form of SLR?
Statutory liquidity ratio
What is CLR rate of bank?
cash liquidity ratio
What is the slr ratio for bank?
SLR stands for Statutory Liquidity Ratio. Statutory Liquidity Ratio is the amount of liquid assets, such as cash, precious metals or other approved securities, that a financial institution must maintain as reserves other than the Cash with the Central Bank. The statutory liquidity ratio is a term most commonly used in India.
What are the types of liquidity ratios?
1) Statutory Liquid Ratio 2) Cash Reserve Ratio
