European Union: Publication of Financial Sector Assessment Program Documentation—Technical Note on Macroprudential Oversight and the Role of the ESRB

IMF Staff Country Reports, March 15, 2013

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European Union: Publication of Financial Sector Assessment Program Documentation—Technical Note on Macroprudential Oversight and the Role of the ESRB

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Bibliographic details

• Published: March 15, 2013
• Series: IMF Staff Country Reports
• DOI: https://doi.org/10.5089/9781475591156.002

Overview

• Article reviews the European Systematic Risk Board (ESRB), its role, approach, outputs, and effects in the European Union.
• States that the ESRB is the reason for macroprudential oversight of financial systems.
• Describes macroprudential policy as used to identify and reduce financial risks and limit financial imbalances across economic cycles (both upturns and downturns).
• Concludes that the role of the ESRB should be further enhanced to cover the entire financial system and institutions.
• Publication date: March 15, 2013.

Key Findings and Analysis

• The ESRB is central to macroprudential oversight in the European Union.
• Macroprudential policy objectives:
  • Identify financial risks.
  • Reduce financial risks.
  • Limit financial imbalances.
• Macroprudential policy applies to both upturns and downturns of economic cycles.
• Recommendation to further enhance the ESRB’s remit to encompass the entire financial system and financial institutions.
• Effects considered include ESRB outputs and their influence on EU financial stability.

Policy Recommendations

• Enhance the role of the ESRB to cover the entire financial system and institutions.
• Use macroprudential policy proactively during both economic upturns and downturns to identify and mitigate systemic risks and financial imbalances.

Outputs, Scope, and Instruments

• Focus on ESRB outputs, approach, and effects within the EU financial sector.
• Identifies macroprudential policy instruments as tools to address systemic risk and stability concerns.
• Emphasizes systemic risk assessment as core to ESRB activities.

Subjects and Keywords

• Subjects: Financial sector policy and analysis; Financial sector stability; Macroprudential policy; Macroprudential policy instruments; Systemic risk; Systemic risk assessment.
• Keywords: a number of EU credit institution; CR; ESRB recommendation; ESRB staff; EU country; EU credit institution; EU financial system; EU institution; EU level; Europe; Financial sector stability; ISCR; Macroprudential policy; Macroprudential policy instruments; stability concern; Systemic risk; Systemic risk assessment.

Content in this bundle

• _cr1370 — Macroprudential Oversight and the Role of the Esrb — Technical Note
  • _cr1370 — Macroprudential Oversight and the Role of the Esrb — Technical Note (Markdown version)
  • _cr1370 — Macroprudential Oversight and the Role of the Esrb — Technical Note (PDF)