Assertion (A): Large commercial banks in India increasingly prefer to offer 'Physical Sweeping' over 'Notional Pooling' to corporate groups operating as multiple legal entities under the same management control. Reason (R): Under the Basel III liquidity framework and RBI's guidelines on Liquidity Coverage Ratio (LCR), notional pooling arrangements often require banks to maintain higher capital and liquidity buffers because gross debit and credit balances cannot be legally netted off for regulatory reporting purposes.

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Economics · Basel III and Banking Liquidity

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