MANILA – The Bangko Sentral ng Pilipinas is requiring universal and commercial banks to have funds ready to cover liquidity needs for a year.
The central bank’s policy-setting Monetary Board has approved the Net Stable Funding Ratio (NSFR) for universal and commercial banks to adopt starting next year.
“The NSFR is a measure of the ability of a bank to fund its liquidity needs over one year. It complements the Liquidity Coverage Ratio which covers a shorter period of over 30 days in which a bank shall hold sufficient high quality liquid assets that can be easily converted into cash to service their liquidity requirements,” the Bangko Sentral said in a statement.
Both ratios are aimed at strengthening the ability of banks to withstand liquidity stress and promote resilience of the banking sector. (GMA News)
