OSFI Consults on NSFR Disclosure Requirements for D-SIBs
OSFI proposed the draft guideline on the net stable funding ratio (NSFR) disclosure requirements for domestic systemically important banks (D-SIBs). The comment period on the consultation ends on March 15, 2019. Implementation of the NSFR public disclosure by D-SIBs in Canada is proposed to commence with the quarterly reporting period ending January 31, 2021.
The guideline stipulates that D-SIBs should provide NSFR disclosures quarterly and with the publication of the financial statements. OSFI has designated six institutions as D-SIBs: Bank of Montreal, Bank of Nova Scotia, Canadian Imperial Bank of Commerce, National Bank of Canada, Royal Bank of Canada, and Toronto-Dominion Bank of Canada. As per the guideline, D-SIBs should provide the following disclosures:
- NSFR disclosure template. The template captures key quantitative information about the NSFR and is calculated on a regulatory consolidated basis and presented in Canadian dollars. D-SIBs are required to disclose the NSFR data based on quarter-end positions. The Appendix provides the proposed NSFR disclosure template and the associated completion instructions.
- NSFR qualitative disclosures. D-SIBs should provide sufficient qualitative disclosures on the NSFR to facilitate understanding of the results and data disclosed. This information should be provided on a quarterly basis to supplement the NSFR disclosure template. Where significant to the NSFR, D-SIBs could discuss the:
- Drivers of their NSFR results and the reasons for intra-period changes as well as the changes over time (for example, changes in strategies, funding structure, circumstances)
- Composition of interdependent assets and liabilities and to what extent these transactions are interrelated
OSFI issued a consultation on the NSFR requirements in December and the consultation period ended on February 01, 2019. Chapter 3 of the Liquidity Adequacy Requirements (LAR) guideline incorporates the NSFR rules issued by BCBS in October 2014 into the LAR Guideline. NSFR guideline, which is expected to come into effect on January 01, 2020, requires institutions to maintain a stable funding profile in relation to their on- and off-balance sheet activities, thus reducing the likelihood that disruptions to an institution's regular sources of funding will erode its liquidity position in a way that could increase the risk of its failure and potentially lead to broader systemic stress. NSFR limits over reliance on short-term wholesale funding, encourages better assessment of funding risk across all on- and off-balance sheet items, and promotes a more stable funding profile.
Related Links
Comment Due Date: March 15, 2019
Effective Date: January 01, 2020
Keywords: Americas, Canada, Banking, Basel III, Liquidity Risk, NSFR, LAR Guideline, D-SIBs, Disclosures, OSFI
Previous Article
BCBS Updates Instructions for Basel III Monitoring ExerciseRelated Insights
|
News
OFR Adopts Data Collection Rule on Centrally Cleared Repo TransactionsOFR adopted a final rule to establish a data collection covering centrally cleared funding transactions in the U.S. repurchase agreement (repo) market.
February 20, 2019
WebPage
Regulatory News
|
|
News
FHFA Finalizes Rule on Federal Home Loan Bank Capital RequirementsFHFA published, in Federal Register, the final rule to adopt, as its own, portions of the regulations of the Federal Housing Finance Board pertaining to the capital requirements for the Federal Home Loan Banks.
February 20, 2019
WebPage
Regulatory News
|
|
News
SRB Publishes Framework for Performing Valuations in ResolutionThe framework provides independent valuers and the general public with an indication of the expectations of SRB on the principles and methodologies for valuation reports, as set out in the legal framework.
February 19, 2019
WebPage
Regulatory News
|
|
News
US Agencies Extend Consultation Period for the Proposed SA-CCRUS Agencies (FDIC, FED, and OCC) extended the comment period for a proposed rule to update their standards for how firms measure counterparty credit risk posed by derivative contracts.
February 18, 2019
WebPage
Regulatory News
|
|
News
FED Extends Consultation Period for Stress Testing RuleFED has published in the Federal Register a notice proposing amendments to the company run and supervisory stress test rules.
February 15, 2019
WebPage
Regulatory News
|
|
News
EBA Single Rulebook Q&A: Third Update for February 2019EBA published answers to two questions under the Single Rulebook question and answer (Q&A) updates for this week.
February 15, 2019
WebPage
Regulatory News
|
|
News
SEC Proposes Rule on Risk Mitigation Techniques for Uncleared SBSSEC proposed a rule that would require the application of specific risk-mitigation techniques to portfolios of security-based swaps (SBS) that are not submitted for clearing.
February 15, 2019
WebPage
Regulatory News
|
|
News
FSB Report Examines Financial Stability Implications of FintechFSB published a report that assesses fintech-related market developments and their potential implications for financial stability.
February 14, 2019
WebPage
Regulatory News
|
|
News
US Agencies Amend Regulatory Capital Rule to Allow Phase-In for CECLUS Agencies (FDIC, FED, and OCC) adopted the final rule to address changes to credit loss accounting under the U.S. generally accepted accounting principles; this includes banking organizations’ implementation of the current expected credit losses (CECL) methodology.
February 14, 2019
WebPage
Regulatory News
|
|
News
FASB Proposes Taxonomy Improvements for the Credit Losses StandardFASB proposed the taxonomy improvements for the proposed Accounting Standards Updates on Targeted Transition Relief for Topic 326 (Financial Instruments—Credit Losses) and Topic 805 (on Business Combinations—Revenue from Contracts with Customers).
February 14, 2019
WebPage
Regulatory News
|
