FINMA issued a consultation on amendments to the circular (2015/2) on liquidity risks for banks. The amendments relate to the technical implementing provisions and refinements to the new requirements for net stable funding ratio (NSFR), as set out in the Liquidity Ordinance. FINMA is introducing general adjustments to the qualitative requirements and to the liquidity coverage ratio (LCR), constituting clarifications and editing changes to the previous regulation. The consultation takes into account the timetable for adoption of the Liquidity Ordinance. The consultation period will run until July 13, 2020 while the corresponding changes are due to enter into force on July 01, 2021.
In November 2019, the Swiss Federal Council had decided to introduce NSFR for banks by mid-2021 and to make the corresponding adjustments to the Liquidity Ordinance. This also necessitated changes to the FINMA supervisory practice, as set out in the circular (2015/2) on liquidity risks for banks. As required in the Basel III minimum standards, banks must meet stricter liquidity requirements and fulfill internationally harmonized funding requirements. The Federal Council had adapted the Liquidity Ordinance in 2017 in line with these international rules, but had postponed the introduction of NSFR. FINMA had also adjusted the circular on liquidity risks for banks at that time and ran a consultation exercise. The present consultation, therefore, only concerns a number of clarifications and editing changes.
- Press Release
- Key Points to Consultation (PDF)
- Changes to Circular 2015/02 (PDF in German)
- Explanatory Report on Consultation (PDF in German)
Comment Due Date: July 13, 2020
Effective Date: July 01, 2021
Keywords: Europe, Switzerland, Banking, LCR, NSFR, Liquidity Risk, Liquidity Ordinance, Circular 2015/2, Basel III, Swiss Federal Council, FINMA
Previous ArticleESAs Defer Final Two Phases of Margin Rules for OTC Derivatives
FSB published the annual report that examines to-date progress toward implementation of climate-related disclosure recommendations of the industry-led Task Force on Climate-related Financial Disclosures (TCFD).
PRA launched a consultation (CP18/20) setting out proposals for the "Contractual Recognition of Bail-in" and "Stay in Resolution" Rules.
APRA is consulting on the reporting standard for credit risk management (ARS 220.0).
EC published draft of a delegated regulation amending liquidity coverage rules for covered bond issuers.
ESMA published an update to its March 2019 statement on the endorsement of credit ratings from UK.
FASB is consulting on the XBRL US Data Quality Committee (DQC) Rules Taxonomy (DQCRT) along with two technical guides.
PRA published Version 2 of the questions and answers (Q&A) on the Branch Return form.
FCA and PRA in the UK, FED in the US, and the authorities in Singapore have fined Goldman Sachs for risk management failures in connection with the 1Malaysia Development Berhad (1MDB).
ISDA launched the IBOR Fallbacks Supplement and the IBOR Fallbacks Protocol, with both becoming effective on January 25, 2021.
BCBS announced that OSFI and the Bank of Canada hosted the 21st International Conference of Banking Supervisors (ICBS) virtually on October 19-22, 2020.