Featured Product

    ECB Publishes Paper on Its Macro-Prudential Policy Framework

    July 17, 2019

    ECB published an occasional paper that describes how the financial stability and macro-prudential policy functions are organized at ECB. Macro-prudential policy tasks were conferred on ECB by the Single Supervisory Mechanism (SSM) Regulation. The paper describes the macro-prudential governance framework of ECB in the new institutional setup. After reviewing the concept and origins of systemic risk, it reflects on the emergence of macro-prudential policy in the aftermath of the financial crisis, its objectives, and the instruments in application.

    The paper discusses the macro-prudential policy analysis at ECB as well as the selected analytical tools supporting financial stability surveillance and assessment work. The tools are grouped into three broad areas:

    • Methods to gauge the state of financial instability or prospects of near-term systemic stress
    • Measures to capture the build-up of systemic risk focused on country-level financial cycle measurement and early warning methods
    • ECB stress testing framework for macro-prudential purposes

    The analytical strengthening has provided ECB with systemic risk identification and assessment tools appropriate for supporting macro-prudential policy calibration, such as the countercyclical capital buffer to address cyclical risks or capital buffers for systemic institutions to address structural risks. While the framework has come a long way since its infancy, there are still a number of challenges and open issues; therefore, work continues on tackling boundary issues with regard to a growing non-bank sector and the associated market-based finance.

     

    Related Link: Occasional Paper (PDF)

     

    Keywords: Europe, EU, Banking, Macro-Prudential Policy, SSM, Systemic Risk, Stress Testing, CCyB, ECB

    Featured Experts
    Related Articles
    News

    APRA Consults on Standard for Reporting of COVID-19 Loans

    APRA issued a letter to authorized deposit-taking institutions announcing its intent to formalize the capital measures and reporting requirements for COVID-19 loans through temporary legislative instruments.

    August 13, 2020 WebPage Regulatory News
    News

    EBA Consults Industry on Use and Uptake of Regtech Solutions Across EU

    EBA is inviting relevant stakeholders, such as financial institutions and information and communication technology (ICT) third-party providers, to share their views and experience on the use of regtech solutions through its regtech industry survey.

    August 12, 2020 WebPage Regulatory News
    News

    BoE Clarifies Approach to Treatment of Payment Holidays on Form PL

    BoE published a statistical notice (Notice 2020/9) explaining the approach for treatment of payment holidays on the profit and loss return or Form PL.

    August 11, 2020 WebPage Regulatory News
    News

    FASB to Conduct Post-Implementation Review of CECL Standard

    FASB announced the launch of its new Post-Implementation Review (PIR) web portal.

    August 11, 2020 WebPage Regulatory News
    News

    EBA Guidance on Impact of CRR Quick-Fix on Reporting and Disclosures

    EBA revised the draft implementing technical standards on supervisory reporting as part of the reporting framework 3.0.

    August 11, 2020 WebPage Regulatory News
    News

    ECB Examines ICAAP Practices of Banks in EU

    ECB published report that presents a summary of the analysis conducted on the internal capital adequacy assessment process (ICAAP) practices of a sample of 37 "significant" banks.

    August 11, 2020 WebPage Regulatory News
    News

    BoE Provides Reporting Update on Form AS and Form FV

    BoE updated the known issues document for the statistical reporting Forms AS and FV.

    August 10, 2020 WebPage Regulatory News
    News

    FED Announces Capital Requirements for Large Banks

    FED announced individual capital requirements for 34 large banks and these requirements go into effect on October 01, 2020.

    August 10, 2020 WebPage Regulatory News
    News

    SRB Publishes Guidance on Implementation of Bail-In Tool

    SRB published a set of documents to give operational guidance to banks on implementation of the bail-in tool.

    August 10, 2020 WebPage Regulatory News
    News

    BIS Publishes Update on G20 TechSprint Initiative

    BIS published an update on the G20 TechSprint Initiative, which was launched in April 2020 and aims to highlight the potential for technologies to resolve regulatory compliance (regtech) and supervisory (suptech) challenges.

    August 10, 2020 WebPage Regulatory News
    RESULTS 1 - 10 OF 5658