Mandatory Financial Stability Assessments under the FSAP

September 24, 2014

On December 6, 2013, the Executive Board of the International Monetary Fund (IMF) reviewed the experience with the implementation of the decision adopted in September 2010 to integrate financial stability assessments under the Financial Sector Assessment Program (FSAP) into Article IV Surveillance on a mandatory basis for member countries with systemically important financial sectors. At the time of the 2010 decision, 25 jurisdictions were deemed to have systemically important financial sectors—see table below. The decision to make financial stability assessments under the FSAP mandatory for them resulted in a more risk-based approach to financial sector surveillance and better integration of FSAPs into Article IV consultations in these jurisdictions. The review conducted in December 2013 uses a new methodology for determining jurisdictions with systemically important financial sectors. The new methodology places greater emphasis on interconnectedness; expands the range of covered exposures; takes into consideration the potential for price contagion across financial sectors; and uses the most recent available data, while adhering to the principles of relevance, transparency, and even-handedness established by the 2010 Executive Board decision. Based on the new methodology, four additional jurisdictions—Denmark, Norway, Poland, and Finland—were added to the list of jurisdictions whose financial sectors are deemed to be systemically important. The Executive Board also updated the legal framework governing mandatory financial stability assessments to reflect the Integrated Surveillance Decision adopted in July 2012, and to allow a more comprehensive analysis of spillovers arising from members’ financial sector policies.


Jurisdictions with Systemically Important Financial Sectors

AustraliaHong Kong SARPoland
AustriaIndiaRussian Federation
BelgiumIrelandSingapore
BrazilItalySpain
CanadaJapanSweden
ChinaKoreaSwitzerland
DenmarkLuxembourgTurkey
FinlandMexicoUnited Kingdom
FranceNetherlandsUnited States
GermanyNorway
 
Countries in italic were added in 2013.