The Bank for International Settlements has published a press release announcing that the Basel Committee on Banking Supervision’s (BCBS) oversight body, the Group of Governors and Heads of Supervision (GHOS), has endorsed:

  • a common definition of the leverage ratio. The BCBS will continue to monitor the implementation of the leverage ratio with final calibration and further adjustments to be completed by 2017 so that the migration to a Pillar 1 (minimum capital requirement) treatment can occur on 1 January 2018;
  • changes to the net stable funding ratio (NSFR). Finalising the NSFR is a priority for the BCBS during 2014 and a consultative document on proposed revisions will be issued shortly;
  • minimum requirements for liquidity-related disclosures. The GHOS also endorsed the BCBS’ intention to publish further guidance on how national authorities can utilise market based indicators of liquidity within their own frameworks for assessing whether assets qualify as high quality liquid assets (HQLA) under the liquidity coverage ratio (LCR). The BCBS has also reached the view that committed liquidity facilities of a type already recognised for jurisdictions with insufficient HQLA could have a role to play within the LCR. The BCBS will shortly issue revisions to the LCR to give effect to this change; and
  • the strategic priorities of the BCBS for the next two years. Apart from completing the financial crisis-related policy reforms the BCBS will focus on three broad themes: continuing to deepen its programme of monitoring and assessing the implementation of the agreed reforms; further examining the regulatory framework’s balance between simplicity, comparability and risk sensitivity; and improving the effectiveness of supervision.

View Important steps towards completion of post-crisis regulatory reforms endorsed by group of governors and heads of supervision, 12 January 2014