The Net Stable Funding Ratio (NSFR) that is being introduced in 2018 will require banks to hold assets with a residual maturity of more than one year to fund illiquid assets on their books. Local regulatory authorities will transpose these statutory requirements. In Europe, LCR is being implemented in a phased manner until 2019 through the Capital Requirements Directive IV (CRD IV. A few amendments have been recommended for CRD IV and the capital requirements are being implemented under the CRD V package. Banks must demonstrate how they distinguish between the operational and non-operational types of deposit, which may place an additional reporting requirement on corporate treasury practitioners.
Traditional banks must evaluate their place within the payments ecosystem and be open to partnering with FinTechs and third-party developers to drive value collaboratively.
Structural changes are spurring payments industry participants to evaluate the future of the business as well as their role in the months and years ahead.
The Payment Services Directive 2 or PSD2 has been in full force for more than six months, and its impact is being felt not just in the European Union, but across the globe – with several markets, such as Singapore, Australia, and Nigeria, as well as Hong Kong announcing open banking initiatives inspired by the PSD2