Big bank treasurers and heads of structured finance are starting to formulate the funding strategies they will put in place to deal with the requirements of the new net stable funding ratio. One message they have is that it is not good news for the securitisation market.From the beginning of 2018 banks will have to demonstrate that long-term assets are financed with at least a minimum of stable funding. Stable funding is the portion of an authorised deposit-taking institution's capital and liabilities expected to be a reliable source of funds over a one-year time horizon.NSFR will force banks to rely more on deposits (especially term deposits) and long-term wholesale funding as funding sources, and less on short-term wholesale funding.In theory, securitised funding - residential mortgage-backed securities and covered bonds - looks like the sort of stable funding that would fit well in the NSFR regime.However, while mortgages receive favourable treatment under the NSFR rules, encumbered assets (such as RMBS) receive less favourable treatment.Speaking at the Australian Securitisation Forum conference in Sydney yesterday, ANZ head of capital and structured funding John Needham said: "RMBS takes us backwards on NSFR."Another speaker at the conference, Westpac head of structured funding and capital Guy Volpicella said: "If we are doing RMBS, it is inefficient from an NSFR perspective. It makes more sense to do senior [debt]."