From the Regulators

The framework aims to ensure the maintenance and stability of funding and liquidity profiles of banks' balance sheets

By James Langton |

To improve transparency about banks' funding status, global regulators published a consultation paper Tuesday setting out new disclosure requirements.

The Basel Committee on Banking Supervision issued proposed disclosure standards for the new "net stable funding ratio" requirement, which was finalized earlier this year.  The committee says that the disclosure framework aims to improve the transparency of regulatory funding requirements, reinforce the principles of sound liquidity risk management, bolster market discipline, and reduce uncertainty in the markets as the new funding requirements are implemented.

"It is important that banks adopt a common public disclosure framework to help market participants consistently assess banks' funding risk," the Basel Committee says.

Internationally-active banks will be required to publish their funding ratios according to a common template in order to "promote the consistency and usability" of these disclosures. Banks will be required to comply with the new disclosure requirements starting in the first reporting period after Jan. 1 2018.

The proposals are out for comment until Mar. 6, 2015.