Journal of
Italian
Banking
Association

year 100
 

Forum | Papers » Does the Net Stable Funding Ratio affect European cooperative banks’ riskiness?

Does the Net Stable Funding Ratio affect European cooperative banks’ riskiness?

Erika Bragaglia
December 2022 - n. 12
Keywords: Cooperative Banks, Financial Stability, Funding Liquidity Risk, Net Stable Funding Ratio
Jel codes: G21, G28

In 2010 the Basel Committee on Banking Supervision (Bcbs) introduced new liquidity rules phased in under Basel III and, specifically, defined the Net Stable Funding Ratio (Nsfr) with the aim of making the financial system more stable and resilient. The aim of this analysis is to examine the relationship between the Nsfr and banks’ riskiness with a particular focus on cooperative credit institutions. Based on a panel dataset of 1,173 cooperative banks from Austria, Germany and Italy, observed over the years 2011-2018, I find that riskiness decreases for cooperative banks that have higher Nsfrs. Results remain robust after some robustness tests.

Interested in this paper?
Buy the issue