The China Banking and Insurance Regulatory Commission (CBIRC) hopes to improve the liquidity risk management of commercial banks with the launch of new disclosure requirements.
CBIRC released the “Commercial Bank Net Stable Funding Ratio Information Disclosure Measures” (商业银行净稳定资金比例信息披露办法) on 19 March, with CBIRC officials stating that disclosure of net stable funding ratios will help to improve liquidity risk management by banks.
In June 2015 the Basel Committee on Banking Supervision released the “Net Stable Funding Ratio Disclosure Standards,” which called for relevant banks in member states to perform disclosure of net stable funding ratios.
The net stable funding ratio is one of three liquidity indices recently introduced by CBIRC, and serves as a measure of the stability of a bank’s funding sources, as well as its ability to deal with medium and long-term balance sheet structural issues.
CBIRC requires that the net stable funding ratio of commercial banks with assets of 200 billion yuan or more be greater than 100%.