Islamic banks are required to be able to access and hold sufficient levels of High Quality Liquid Assets (HQLA) as part of Basel III requirements. Such HQLA are specifically meant to allow the Islamic banks to raise funds in money markets in the event of liquidity shortage or in some cases for the funding of new profitable investments. Against this backdrop, this study examines existing efforts in developing SharÄ«’ah-compliant HQLA and the challenges Islamic financial institutions are facing in assessing such liquid instruments. Beside the laudable efforts of a policy-driven supranational institution in developing SharÄ«’ah-compliant HQLA, there has not been much effort in the global Islamic finance industry to develop more HQLAs. As a matter of fact, it is the overarching dearth of such SharÄ«’ah compliant HQLA for liquidity management that led the Bank of England to commence work on the feasibility of introducing central bank liquidity facilities such as the proposed SharÄ«’ah compliant fund based deposit in 2015 which is expected to be ready for implementation by Spring 2018. This study also finds that experts have considered the potential of gold as HQLA for bank’s liquidity management.