Finland: Financial sector Assessment Program: Technical Note-Macroprudential Policy Framework

IMF Staff Country Reports, January 11, 2017

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The Technical Note discusses findings and recommendations made in the Financial Sector Assessment Program for Finland in the area of macroprudential policy framework.
The Finnish authorities regularly coordinate and collaborate with international bodies on macroprudential policy.
Several macroprudential instruments were formally introduced in legislation and activated recently.
The 2014 Act on Credit Institutions implements macroprudential instruments, including those set out in the European Capital Requirement Directive.
Despite important progress, improvements should be considered in the macroprudential framework.

The macroprudential policy toolkit should be expanded.
The systemic risk buffer should be added to the toolkit, although its activation and level may still need further analysis.

The 2014 Act on Credit Institutions implements macroprudential instruments, including those set out in the European Capital Requirement Directive.
Recent formal introductions and activations of several macroprudential instruments have occurred under the existing legislative framework.

Subjects: Banking; Financial institutions; Financial sector policy and analysis; Loans; Macroprudential policy; Macroprudential policy instruments; Systemic risk; Systemic risk assessment
Keywords: Baltics; banking sector; CR; FIN-FSA decision-making power; FIN-FSA director general; FIN-FSA's Board; FIN-FSA's expertise; FIN-FSA's mandate; ISCR; Loans; Macroprudential policy; Macroprudential policy instruments; Systemic risk; Systemic risk assessment