Austria: Publication of Financial Sector Assessment Program Documentation-Technical Note on Macroprudential Policy Framework and Tools

IMF Staff Country Reports, March 2, 2020

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Canonical URL: Austria: Publication of Financial Sector Assessment Program Documentation-Technical Note on Macroprudential Policy Framework and Tools

The technical note assesses strengths and weaknesses of the macroprudential policy framework in Austria and provides policy recommendations.
Financial sector resilience in Austria has improved significantly since the global financial crisis.
The macroprudential policy framework has been formalized.
The institutional framework is appropriate for conducting macroprudential policy effectively, but it could be strengthened in some areas.
Some structural vulnerabilities to financial stability remain and cyclical risks are on the rise.

Banks’ low efficiency and the resulting low profitability of domestic operations continues to be a key concern.
The Central Europe and South Eastern Europe region accounts for over 40 percent of Austrian banks' consolidated profits.
Broad-based vulnerabilities remain contained, but build-up of risks in the real estate sector warrants further action.

The framework contains a clear mandate, well-defined objectives, and provides enough powers to the Financial Market Stability Board (FMSB).
The framework for addressing structural vulnerabilities is sophisticated; however, further improvements could be considered.
The institutional framework could be strengthened in some areas to improve macroprudential policy effectiveness.

Banking; Financial institutions; Financial sector policy and analysis; Financial sector risk; Financial sector stability; Housing prices; Loans; Macroprudential policy; Prices.

1autea2020004 - Executive Summary
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- 1autea2020004 - Executive Summary (PDF)