Guernsey Upgrades Bank Liquidity Framework
by Jason Gorringe, Lowtax.net, London
16 November, 2016
Guernsey's financial services regulator has issued a consultation paper on proposals for the implementation of a new regulatory liquidity framework for banks.
The proposed framework would establish a revised minimum regulatory liquidity requirement for Guernsey incorporated banks, consistent with the Basel Committee's Basel III standard, along with revised liquidity reporting requirements for all banks.
Basel III is a comprehensive set of reform measures, developed by the Basel Committee on Banking Supervision, to strengthen banking sector regulation, supervision, and risk management.
The substantive changes being proposed include the establishment of a new minimum regulatory liquidity requirement for Guernsey incorporated banks consistent with the Basel Committee's Basel III Liquidity Coverage Ratio standard; establishment of a new regulatory liquidity reporting requirement for Guernsey incorporated banks consistent with the Basel Committee's Basel III Net Stable Funding Ratio standard; and the transition of the current maturity mismatch minimum liquidity standard to a regulatory reporting requirement for all banks.
The Commission also intends to revise the prudential reporting forms to reflect the above changes.
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