A statement of the Bank said that this policy addresses according to the intermediate variables, including the quality of growth in the amount of cash offers, the ability to manage liquidity and the tools of the monetary policy desired by it, pointing out that the new mechanism would include working with the currency and securities markets to create an effective system of payment that grants banks the trust to meet their payment obligations at reasonable cost, and the most costly in the provision of liquidity is the use of additional reserves such as money in treasuries and balances in excess of the legal reserve requirements.
The statement confirmed that the margins of the difference between interest rates on deposits and loans can be reduced by allowing the banks to reduce the possession of the proceeds resulting from surplus requirements that have no interests, explaining that the ability of banks depend on reducing excess requirements through reliable media in the management of liquidity.(Source)AlSabah
