United Kingdom: Financial Sector Assessment Program-Stress Testing the Banking Sector-Technical Note
IMF Staff Country Reports, June 17, 2016
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- United Kingdom: Financial Sector Assessment Program-Stress Testing the Banking Sector-Technical Note
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Bibliographic details
- Published: June 17, 2016
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781484394120.002
Overview and Purpose
- Publication date: June 17, 2016
- Pages: 91
- Issue: 163
- Volume: 2016
- Series: Country Report No. 2016/163
- DOI: https://doi.org/10.5089/9781484394120.002
- ISBN: 9781484394120
- ISSN: 1934-7685
- Stock No: 1GBREA2016011
- This paper discusses how the Financial Sector Assessment Program (FSAP) stress test assesses the resilience of the banking sector as a whole rather than the capital adequacy of individual institutions.
FSAP Stress Testing Approach (Macroprudential Focus)
- The FSAP approach to stress testing is essentially macroprudential: it focuses on resilience of the broader financial system to adverse macro-financial conditions rather than on resilience of individual banks to specific shocks.
- The test ensures consistency in macroeconomic scenarios and metrics across firms to facilitate the assessment of the banking system as a whole.
- Intended uses:
- To help country authorities identify key sources of systemic risk in the banking sector.
- To inform macroprudential policies to enhance the banking sector’s resilience to absorb shocks.
Key Concepts and Metrics Emphasized
- Focus on banking system resilience rather than individual institution capital adequacy.
- Consistent macroeconomic scenarios and metrics applied across firms.
- Emphasis on assessing systemic risk and informing macroprudential policy interventions.
Subjects and Keywords (as provided)
- Subjects: Banking; Credit risk; Financial crises; Financial regulation and supervision; Financial Sector Assessment Program; Financial sector policy and analysis; Solvency stress testing; Stress testing
- Keywords: banking system; BoE scenario; cash flow; CR; Credit risk; Financial Sector Assessment Program; fixed income; Global; hurdle rate; interest rate; ISCR; money market; mortgage portfolio; single currency; Solvency stress testing; stress test; Stress testing; U.K. bank; U.K. leverage framework; U.K.-headquartered bank; yield curve
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International Monetary Fund. Monetary and Capital Markets Department "United Kingdom: Financial Sector Assessment Program-Stress Testing the Banking Sector-Technical Note", IMF Staff Country Reports 2016, 163 (2016).
Content in this bundle
- _cr16163 — Executive Summary and Key Findings