The liquidity indicator approach uses financial ratios whose changes over time may reflect the

changing liquidity position of the financial institution. The ratios are used to estimate liquidity
needs and to monitor changes in liquidity position.
Cash Position Indicator
It shows the amount of cash and highly liquid assets which is the deposits that the bank holds at a
specific point in time as a ratio to the total assets that the bank holds. The formula for cash
position indicator is
Cash Position Indicator = (Cash+ Deposits)/ Total assets
Cash Position
Indicator
2008 2009 2010 2011 2012
Cash and Deposits 48,154,507,8
06
72,562,462,2
92
73,578,266,04
4
91,310,017,75
9
102,535,373,3
48
Total Assets 90,898,051,9
72
76,466,801,5
64
130,185,631,8
12
115,735,967,6
84
130,185,631,8
12
Cash Position
Indicator
0.529764 0.9489407 0.0.565179 0.78895 0.79
A greater proportion of cash means that a bank is in stronger position to handle immediate cash
needs. Individually, the bank experienced the lowest CPI in 2008 mainly because its growth in
total assets was greater than its growth in cash and deposits in that year. The banks CPI
experienced a fall in the years 10 while it picked up in 12 and 11. Overall, the banks CPI was
never below 0.529 in the past 5 years which means it had always been able to back more than
52% percent of its total assets with its cash flow which keeps the bank in a very liquid position.
Liquid Securities Indicator
This compares the most marketable securities the bank can hold with the overall size of its asset
portfolio. The formula for Liquid Securities Indicator is
Liquidity Position Indicator = Short term securities/ Total assets

Liquidity Position
Indicator
2008 2009 2010 2011 2012
Short Term Securities 89,192,805
2,281,793,1
08
1,673,817,749
5,552,363,63
9
4,897,126,471
Total Assets
90,898,051,9
72
76,466,801,
564
90,898,051,97
2
115,735,967,
684
130,185,631,8
12
Liquid Securities
Indicator
0.001 0.030 0.018 0.048 0.038
In general, The City Banks short term securities are a very small fraction of its Total assets
which says that in terms of short term securities, the bank is not in a liquid position. In 2012, it
had the highest amount of short term securities in all 5 years. This is also reflected in the
Liquidity Position Indicator which was the highest in 5 years in 2013.
Hot money ratio
This reflects whether the bank has balanced its borrowings in the money market with increases in
its money market assets that could be sold quickly to cover those money market liabilities. The
formula for hot money ratio is
Hot money ratio= Money market asset/Money market liability
2008 2009 2010 2011 2012
Hot Money Ratio
1.806315749
1.646915013 1.2404307 0.779670081 0.631679607
In the most recent year the bank had 63% of its money market liabilities backed by its money
market assets. The ratio is on a decreasing trend. 2008 saw the highest of its ratio with 180%
backed.