Entire Section

  • PIB 9.2A.1 PIB 9.2A.1

    (1) An Authorised Firm must develop a funding strategy that provides effective diversification in the sources and nature of its funding.
    (2) An Authorised Firm must ensure that the funding strategy is in writing and is approved by its Governing Body.
    (3) The funding strategy must be in line with the Authorised Firm's stated Liquidity Risk tolerance and supported by robust assumptions that are consistent with the Authorised Firm's budgeting and business planning process.
    (4) The funding strategy must be supported by systems that allow the Authorised Firm to identify, measure, manage and monitor funding positions.
    (5) An Authorised Firm must ensure that its funding strategy is reviewed regularly and at least annually, and is updated as necessary in light of changed funding conditions and any change in the Authorised Firm's strategy.
    (6) An Authorised Firm must notify the DFSA in writing immediately of any material changes to the Authorised Firm's funding strategy.
    [Added] DFSA RM148/2014 (Made 1st January 2015). [VER23/01-15]
    [Amended] DFSA RM209/2017 (Made 25th October 2017). [VER30/01-18]

    • PIB 9.2A.1 Guidance

      1. The diversification under PIB Rule 9.2A.1(1) should include, for example, different counterparties, instruments, currencies, geographies and markets.
      2. The assumptions in PIB Rule 9.2A.1(3) should be forward looking and take into account the macroeconomic and market conditions in which the Authorised Firm operates and any other factors that are likely to impact its funding position.
      3. The DFSA expects that funding positions referred to in PIB Rule 9.2A.1(4) would cover both present and projected positions across multiple time horizons generated from both on- and off-balance sheet items.
      4. In order to formulate the funding strategy properly, an Authorised Firm should pay attention to other risks, including, for example, credit market, operational and reputational risk and their impact of funding requirements.
      5. An Authorised Firm should maintain an ongoing presence in its chosen funding markets and strong relationships with funds providers.
      [Added] DFSA RM148/2014 (Made 1st January 2015). [VER23/01-15]
      [Amended] DFSA RM209/2017 (Made 25th October 2017). [VER30/01-18]