October 06, 2017

BCBS has agreed to allow national discretion for the net stable funding ratio’s (NSFR's) treatment of derivative liabilities. This decision was agreed on, at a meeting during October 04-05, 2017. This should facilitate the implementation of NSFR, which is expected to begin on January 01, 2018.

The NSFR assigns a 20% "required stable funding" factor to derivative liabilities. BCBS has agreed that, at national discretion, jurisdictions may lower the value of this factor, with a floor of 5%. The Basel Committee is considering whether any further revisions to the treatment of derivative liabilities are warranted; if so, it will undertake a public consultation on any proposed changes.

 

Related Link: Press Release

Keywords: International, Banking, NSFR, Derivative Liabilities, National Discretions, BCBS

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