Republic of Croatia: Financial System Stability Assessment: Update
IMF Staff Country Reports, May 16, 2008
Source details
- Canonical URL
- Republic of Croatia: Financial System Stability Assessment: Update
Other formats
Bibliographic details
- Published: May 16, 2008
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781451817485.002
Summary
- The 2002 Financial Stability Assessment Program (FSAP) found that the Croatian financial system was resilient, but vulnerabilities remain.
- Authorities have been proactive in addressing macroeconomic and financial vulnerabilities associated with rapid credit growth.
- Prudential measures have been taken on contingency planning with supervisory authorities of foreign banks.
- Efforts have been made to enhance risk awareness and strengthen home-host coordination.
- The Croatian National Bank (CNB) has put in place an effective bank supervision framework.
- The assessment reflected a legal and regulatory framework together with banking supervision practices of the Croatian authorities.
Key findings and analysis
- Financial system resilience: The assessment concludes that the system was resilient as of the 2002 FSAP, while also identifying persistent vulnerabilities.
- Rapid credit growth: Macroeconomic and financial vulnerabilities were associated with rapid credit growth and were a focus of authorities’ responses.
- Prudential and contingency planning: Authorities implemented prudential measures and contingency planning in coordination with supervisory authorities of foreign banks.
- Supervision and regulation: The CNB established an effective bank supervision framework; the assessment took into account the existing legal and regulatory framework and supervisory practices.
Policy actions and supervisory measures
- Proactive policy response: Authorities addressed vulnerabilities tied to rapid credit expansion through macroeconomic and financial measures.
- Coordination with foreign supervisors: Contingency planning was developed in cooperation with supervisory authorities of foreign banks to manage cross-border risks.
- Risk awareness initiatives: Authorities undertook efforts to enhance risk awareness among stakeholders.
- Home-host coordination: Strengthening of home-host coordination mechanisms was emphasized to improve cross-border supervisory effectiveness.
Content in this bundle
- Executive Summary — _cr08160