Which of the following statements relating to required stable funding is true?
A)The required stable funding (RSF) is found by subtracting the value of assets held and funded by the FI, multiplied by a specific RSF factor assigned to specific asset types.
B)The RSF is found by adding the value of assets held and funded by the FI, multiplied by a specific RSF factor assigned to specific asset types.
C)Assets that are more liquid receive a higher RSF factor.
D)The RSF amount is determined by the liquidity characteristics of the FI's various on-balance-sheet contingent exposures.

Question

Quizplus · Accepted Answer

The Required Stable Funding (RSF) is calculated by adding the value of assets held and funded by the financial institution (FI), each multiplied by its specific RSF factor, which reflects the stability of the funding required over a one-year horizon under conditions of extended stress. This approach ensures that institutions maintain a stable funding profile in relation to the composition of their assets and off-balance sheet activities.

Which of the Following Statements Relating to Required Stable Funding