The following items may be considered as liquid assets:
a.
Cash held in a U.A.E. Bank;
b.
Certificates of deposit issued by the Central Bank held via a U.A.E. Bank;
c.
Short-term deposits with a U.A.E. Bank with maturity up to 30 days; and
d.
UAE Federal and local government bonds, which must not exceed 30% of the total amount of liquid assets.
Encumbered cash held as collateral by a Finance Company is not considered as liquid assets.
12.2
To withstand short-term liquidity stress, Finance Companies are required to hold an amount equivalent to 10% of their Aggregate Liabilities in liquid assets. A Finance Company may, for the purpose of this calculation, deduct from Aggregate Liabilities any of the following items:
a.
Cash collaterals;
b.
Bank guarantees from U.A.E. Banks; and
c.
Sovereign guarantees.
The items listed under the letters a, b and c of this Article must be legally enforceable.
12.3
Consistent with Article 12.2 of this Regulation a Finance Company must not hold more than 25% of its liquid assets in a single U.A.E. Bank.
12.4
Customer deposits of a Finance Company are not subject to cash reserve requirements.