NSFR

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August 31, 2024 3 min read Definitions

Net Stable Funding Ratio (NSFR): Measure of Long-Term Funding Stability

Finance Banking Economics NSFR Basel III Bank Stability Liquidity Risk Financial Regulation

The Net Stable Funding Ratio (NSFR) is a key metric introduced by the Basel III regulatory framework to ensure that banks maintain a stable funding profile over a long-term horizon. This ratio assesses the liquidity risk and promotes resilience against financial stress by requiring banks to secure a proportionate amount of stable funding relative to their assets.