Securitization Perspectives on Net Stable Funding Ratio
In January 2014, the Basel Committee on Banking Supervision published a Consultative Document presenting a net stable funding ratio (NSFR) requirement that will require banks to maintain a stable funding profile in relation to the composition on their assets and off-balance sheet activities. The specific objective of the proposed NSFR requirement is to reduce funding risk over a longer time horizon by requiring banks to fund their activities with sufficiently stable sources of funding in order to mitigate the risk of future funding stress. Comments to the proposed NSFR requirement are due by April 11, 2014. For more information about the NSR and it's impact on securitization, please click the link below.