In a recent statistical notice, BoE announced publication of the reporting schedule for statistical returns for 2021. The statistical notice also sets out that the applicable ratio for the next adjustment to cash ratio deposits is due on December 01, 2020 and the data will be published on November 19, 2020 on the BoE website. BoE will issue call notices to cash ratio deposit payers (which will include this revised cash ratio deposit ratio) shortly thereafter. The deadline for revisions to eligible liabilities to be reflected in the December adjustment is November 17, 2020.
Cash ratio deposits are non-interest bearing deposits lodged with BoE by eligible institutions (banks and building societies), who have reported average eligible liabilities in excess of GBP 600 million over a six-month calculation period. BoE invests these deposits in gilts and the income earned on these investments is used to fund the costs of the BoE’s monetary policy and financial stability operations. The size of the Cash Ratio Deposits placed with BoE is indexed to gilt yields. This means that the ratio and, therefore, the deposits the BoE receives from Cash Ratio Deposit payers, changes periodically depending on the level of past gilt yields. This helps deliver a stable income to cover the cost of BoE undertaking its responsibilities. BoE calculates the representative yield every six months and publishes this along with the underlying data used in the calculation, on the 14th working day of the respective month. The level of cash ratio deposit of each institution is calculated twice every year—in May and November.
Keywords: Europe, UK, Banking, Reporting, Cash Ratio Deposits, Statistical Reporting, Reporting Schedule, BoE
Scott is a Director in the Regulatory and Accounting Solutions team responsible for providing accounting expertise across solutions, products, and services offered by Moody’s Analytics in the US. He has over 15 years of experience leading auditing, consulting and accounting policy initiatives for financial institutions.
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