Liquidity Transfer Pricing is now a Key Element in Banks' Success

Liquidity is arguably one of the essential elements of the banking industry.  Before the global financial crisis of 2007-2008, the general assumption was that funds were always available, at no or very low cost.  Banks seemingly had less need to institute tight liquidity practices, and a number of industry models relied upon the refinancing of long-term assets with short-term liabilities as a common practice.