Operating Liquidity

Operating liquidity includes the management of cash flows that transfer into (sources or inflows) and out of (uses or outflows) a credit union. Sources of funds include member shares, nonmember deposits, borrowings, loan payments, and investment maturities. Uses of funds include share withdrawals, loan originations, payments on borrowings, non-interest operating expenses, and the purchase of investments. If sources exceed uses, a credit union may not be optimizing its earnings opportunities. If uses exceed sources, a credit union may experience liquidity pressure, which hinders its ability to meet share withdrawals, loan demand, and other operational demands.

This section addresses:

• Liquidity Risk Exposure

• Seasonality

Last Updated on August 30, 2021