BIS central bankers’ speeches  7  An alternative to the FSB's proposal would be to apply a system of numerical floors to SFTs regardless of the identity of the parties to the transaction. Such an approach would at least partially offset the incentive that will otherwise exist to move more securities financing activity completely into the shadows.
While the banking sector has already made significant progress to raise the level and quality of its capital and liquidity, immediately implementing in full the more stringent minimum requirements could have negative effects. We will design appropriate transition and grandfathering arrangements that rule this out.