The Basel Committee issued the final standard for the Net Stable Funding Ratio, as endorsed by the Committee’s governing body. The NSFR is a significant component of the Basel III reforms.
Bloomberg reported global banking regulators scaled back plans to boost capital requirements for banks holding asset-backed bonds after lenders warned initial plans would have curtailed lending.
As only one of many factors that will impact decisions about the allocations of bank capital, higher Basel III regulatory capital minimums are unlikely to move the needle up by more than 30 basis points on borrowing costs charged by the well-run lending operations of larger financial institutions to creditworthy customers.
CFO reported that finance organizations are responding positively to the news that the Basel III liquidity rules will not be as strict as bankers had feared and that there will be more time to comply.