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问题如下：

Question An analyst is evaluating three different funding sources with similar residual maturities between six months and one year. Which of the following is considered to be the most stable funding source under Basel III?

选项：

A.A.Funding provided by central banks and financial institutions

B.B.Less stable non-maturity and term deposits provided by retail and small business customers

C.C.Funding from sovereigns, public sector entities, and multilateral and national development banks

解释：

1. Incorrect because Basel III requires a bank to have a minimum amount of stable funding relative to the bank’s liquidity needs over a one-year horizon. Stability of funding is based on the tenor of deposits (e.g., longer-term deposits are more stable than shorter-term deposits) and the type of depositor (e.g., funds from consumers’ deposits are considered more stable than funds raised in the interbank markets).

   Less stable non-maturity deposits and term deposits with residual maturity of less than one year provided by retail and small business customers has an ASF factor of 90%, which is the highest among the three choices. The ASF factor of other funding with residual maturity between six months and less than one year not included in the above categories, including funding provided by central banks and financial institutions" is lower at 50%.

2. Correct because Basel III requires a bank to have a minimum amount of stable funding relative to the bank’s liquidity needs over a one-year horizon. Stability of funding is based on the tenor of deposits (e.g., longer-term deposits are more stable than shorter-term deposits) and the type of depositor (e.g., funds from consumers’ deposits are considered more stable than funds raised in the interbank markets).

   Under Basel III, the available stable funding is determined by assigning a bank’s capital and liabilities to one of five categories. The amount assigned to each category is then multiplied by an available stable funding (ASF) factor, and the total available stable funding is the sum of the weighted amounts. Less stable non-maturity deposits and term deposits with residual maturity of less than one year provided by retail and small business customers has an ASF factor of 90%, which is the highest among the three choices.

3. Incorrect because Basel III requires a bank to have a minimum amount of stable funding relative to the bank’s liquidity needs over a one-year horizon. Stability of funding is based on the tenor of deposits (e.g., longer-term deposits are more stable than shorter-term deposits) and the type of depositor (e.g., funds from consumers’ deposits are considered more stable than funds raised in the interbank markets).

   Less stable non-maturity deposits and term deposits with residual maturity of less than one year provided by retail and small business customers has an ASF factor of 90%, which is the highest among the three choices. The ASF factor of funding with residual maturity of less than one year from sovereigns, public sector entities, and multilateral and national development banks is lower at 50%.

• describe key aspects of financial regulations of financial institutions