In October 2014 the Basel Committee on Banking Supervision (Basel Committee) introduced the Net Stable Funding Ratio (NSFR) as a new liquidity requirement. At the EU level, the Capital Requirements Regulation (CRR) introduced a reporting requirement for the NSFR without setting out more detailed requirements. It also required the European Banking Authority (EBA) to analyse the Basel Committee’s NSFR standard further in a European context. Pursuant to Article 510 of the CRR, the EBA published in December 2015 a report on whether and how it would be appropriate to ensure that institutions use stable sources of funding, supporting the introduction of the Basel Committee’s NSFR at the EU level but with some European specificities regarding its calibration.
The European Commission services is currently analysing the conclusions of the EBA report as well as the responses to a recent call for evidence issued in September 2015 where many respondents expressed concerns that the NSFR could unduly constrain banks’ ability to finance the real economy.
To complement the analysis in the EBA report, the responses to the call for evidence and to provide a basis for legislative changes, the Commission services has launched a consultation to gather stakeholders’ views on the treatment of some specific aspects of the NSFR. Such aspects include derivatives transactions and short term transactions with financial institutions. The deadline for comments on the consultation is 24 June 2016.