Basel Committee Finalizes NSFR Disclosure Standards

The Basel Committee on Banking Supervision today finalized a common format for internationally active banks to disclose the Net Stable Funding Ratio standard that is expected to take effect in January 2018 following rulemaking in individual countries. The NSFR is to be reported quarterly, concurrently with financial reports.

The NSFR standard — a long-term liquidity measurement included in the Basel III liquidity standards that complements the shorter-term measure of cash flow Liquidity Coverage Ratio — was finalized by the committee last year. It is calculated by dividing available stable funding by the minimum required amount of stable funding. Each subject bank’s ratio must be equal to or greater than one.