•        Shift from ratio reporting to execution capability, with rapid, explainable outputs under stress.
•        Integrate capital, liquidity, and IRR to eliminate silo-driven blind spots and second-order risks.
•        Build real-time cash visibility and collateral readiness to ensure actionable liquidity under stress.
•        Maintain buffer discipline and pre-agreed levers to respond quickly to potential LCR/NSFR recalibration.
•        Embed supervisory feedback into policies, governance, and control frameworks with clear accountability.
•        Prepare for Basel Endgame by focusing on granular RWA drivers, data quality, and model transparency.

Ahead of Risk Americas, we spoke with Christopher Brown. In the wake of heightened market volatility since 2023, supervisory expectations have evolved decisively from static ratio compliance toward demonstrable execution under stress. Institutions are now judged on their ability to produce reliable data, mobilize liquidity, and make coordinated balance sheet decisions in real time. This transformation requires not only better infrastructure, but a fundamentally more integrated approach to capital and liquidity management.

What would you advise are the best practices for institutions looking to improve their capital and liquidity strategies to meet evolving supervisory expectations, particularly in light of increased regulatory scrutiny post-market volatility?

Post‑2023, the shift is from having ratios to proving you can execute. The best firms treat liquidity and capital like an operating discipline: reliable data tied to books and records, updated and accurate stress playbooks such as CFP that you can run in hours, and tested governance (with real roles and responsibilities) that forces early escalation and real challenge. If you can’t explain your numbers quickly and repeatably, you won’t be credible when markets move.

Firms are increasingly focused on breaking the risk silos. Historically, liquidity and capital were viewed as two different stripes of financial risk in silos, with parallel processes and ownership for measuring and projecting risk metrics, leading to blind spots to 2nd order downside risks. Firms are now focusing on ensuring maximum commonality across risk scenarios for liquidity and capital as well as for IRR.

Additionally, you should have clear line of sight into what your cash visibility is and make collateral readiness real, so you understand what’s operationally available under stress. Finally, you should connect liquidity decisions to capital outcomes so you don’t fix one and break the other. So there needs to be a clear understanding that funding and liquidity actions can change balance sheet shape, earnings volatility, and capital dynamics. 

What steps should institutions be taking today to prepare for potential recalibration of the Liquidity Coverage Ratio (LCR) and Net Stable Funding Ratio (NSFR), and how would these considerations influence short-term balance sheet and funding decisions?

Operate under the current LCR/NSFR rules and don’t position the balance sheet on the assumption that relief will arrive, since timing and scope are uncertain (even if the “Fed watchers” base case is recalibration/relaxation and potentially indexed thresholds). What you can do now is build ready-to-run scenario analysis around plausible threshold moves (up/down, and indexing mechanics), so you can size the impact quickly and translate it into a short set of executable levers. In the near term, that means keeping an appropriate buffer and pre-agreeing actions on funding mix/tenor and concentrations, HQLA composition/monetization, and balance sheet pacing (what you would slow, term out, or reprice) so you can pivot fast if thresholds change.

How should supervisory feedback and regulatory dialogue currently be incorporated into capital planning frameworks, especially as Basel Endgame proposals continue to evolve?

First, treat each piece of feedback like a requirement that must land somewhere specific: policy, procedure, model governance, or internal controls. This aligns with how capital planning is expected to be supported by “policies, procedures, models/methodologies, audit reports, and review & challenge materials” generated through the year.

Secondly, the two big things supervisors look for are independence and evidence: clear lines of defence, and proof that review and challenge happened and drove outcomes. The third is closure, recurring challenge items need a remediation plan and retesting, not repeated discussion year after year.

Looking ahead, how do you expect Basel Endgame developments to reshape capital planning and model‑based approaches over the next planning cycle, and where do you anticipate the greatest implementation challenges?

Basel Endgame isn’t one-size-fits-all, the impact is really a function of complexity. For smaller, simpler Category IV-type balance sheets, the day‑to‑day planning impact can be pretty modest. Where it does bite is for firms with a heavier capital markets footprint: you end up spending time on CVA and the market risk / FRTB-style framework, plus the supporting data, governance, and reporting. So capital planning shifts from a high-level ratio exercise to a more granular ‘what drives RWAs’ discussion, but only in the parts of the institution where the rules are actually changing.

How do you see the relationship between regulators and firms evolving in the coming years with respect to liquidity modelling and funding strategy, and what actions are you taking now to strengthen that dialogue proactively?

I think the relationship is shifting from periodic, ratio-based check‑ins to a more continuous dialogue focused on operational readiness. It’s less ‘what’s your LCR or ILST’ and more ‘can you show cash visibility, collateral readiness, and a credible playbook you can execute quickly.’ I also expect more emphasis on cash‑flow based stress, intraday liquidity, and the mechanics of contingency funding execution, and ability to translate into strategic outcomes using firm’s FTP framework. So what we’re doing now is tightening the basics: production-grade data with lineage back to books and records, consistent assumptions across liquidity use cases, and tested playbooks around collateral mobilization, intraday monitoring, and funding actions. The other aspect is to use these measurements and engage in continuous dialogue with business and educate them on cost of liquidity and drive the right business behaviour.