From Regulatory Text to Bank Behaviour: The Institutional Logic of the Basel NSFR Framework and Its Manifestation in HSBC

Main Article Content

Chengji Liu
University of Canterbury, 10 University Drive Christchurch 8041

DOI: https://doi.org/10.70267/fer.250302.296307

Keywords

Net Stable Funding Ratio (NSFR), Basel III liquidity regulation, institutional logic

Abstract

This paper examines the Basel III Net Stable Funding Ratio (NSFR) not simply as a technical liquidity requirement, but as a regulatory text that reflects an institutional logic of funding stability. Using qualitative policy text analysis, the study explores how the NSFR framework constructs behavioural expectations through its classifications, weighting system, and regulatory language, especially through the concepts of Available Stable Funding (ASF) and Required Stable Funding (RSF). To connect regulatory design with organisational response, the paper also uses HSBC as a case study and analyses its public disclosures on liquidity, funding, and balance sheet management. The findings suggest that the NSFR promotes a prudential banking model that prioritises stable liabilities, maturity alignment, and structural resilience. HSBC’s disclosures largely reflect this logic in its funding strategy, risk governance, and liquidity reporting. The paper argues that the NSFR should be understood not only as a compliance ratio, but also as a governance mechanism that shapes legitimate banking behaviour.

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Published
Jun 24, 2026
Issue
Vol. 3 No. 2 (2026)
Section
Research Articles
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How to Cite

Liu, C. (2026). From Regulatory Text to Bank Behaviour: The Institutional Logic of the Basel NSFR Framework and Its Manifestation in HSBC. Financial Economics Research, 3(2), 296-307. https://doi.org/10.70267/fer.250302.296307