European split on NSFR worries dealers
Squabble over derivatives liabilities factor sparks fears of unlevel playing field
Conflicting proposals on the calibration of the net stable funding ratio unveiled by European Union policymakers have raised concerns that European banks will be forced to raise a far greater amount of high-quality funding for derivatives positions than foreign dealers.
Last week, the European council presidency issued a progress report on the revised Capital Requirements Regulation (CRR II), which will graft Basel III banking reforms – including the NSFR – into European law. It states that the
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