This chapter describes how to calculate the amount of available stable funding provided by a bank's liabilities and equity and how to calculate the amount of required stable funding for a bank's assets and off-balance-sheet activities.

Version effective as of 15 Dec 2019

First version in the format of the consolidated framework.

Introduction

30.1 The amounts of available stable funding (ASF) and required stable funding (RSF) specified in the standard are calibrated to reflect the presumed degree of stability of liabilities and liquidity of assets.

30.2 The calibration reflects the stability of liabilities across two dimensions:

(1) Funding tenor: the net stable funding ratio (NSFR) is generally calibrated such that longer-term liabilities are assumed to be more stable than short- term liabilities.

(2) Funding type and counterparty: the NSFR is calibrated under the assumption that short-term (maturing in less than one year) deposits provided by retail customers and funding provided by small business customers are behaviourally more stable than wholesale funding of the same maturity from other counterparties.

30.3 In determining the appropriate amounts of required stable funding for various assets, the following criteria were taken into consideration, recognising the potential trade-offs between these criteria:

(1) Resilient credit creation: the NSFR requires stable funding for some proportion of lending to the real economy in order to ensure the continuity of this type of intermediation.