## Austria: Financial System Stability Assessment-Press Release; Staff Report; and Statement by the Executive Director for Austria

_IMF Staff Country Reports, February 3, 2020_

## Source details

**Canonical URL:** [Austria: Financial System Stability Assessment-Press Release; Staff Report; and Statement by the Executive Director for Austria](https://www.imf.org/en/publications/cr/issues/2020/01/31/austria-financial-stability-assessment-press-release-staff-report-and-statement-by-the-49010)

## Other formats

- [Markdown version](/en/publications/cr/issues/2020/01/31/austria-financial-stability-assessment-press-release-staff-report-and-statement-by-the-49010/index.md)
- [Structured JSON version](/en/publications/cr/issues/2020/01/31/austria-financial-stability-assessment-press-release-staff-report-and-statement-by-the-49010/index.json)
- [Bundle manifest](/en/publications/cr/issues/2020/01/31/austria-financial-stability-assessment-press-release-staff-report-and-statement-by-the-49010/bundle-manifest.json)

## Bibliographic details
- Published: February 3, 2020
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781513528786.002

---

### Summary of assessment
- Presents Austria’s 2019 Financial System Stability Assessment.
- Austrian authorities have proactively strengthened the financial stability framework since the previous Financial Sector Assessment Program (FSAP).
- FSAP analysis suggests that banks, in aggregate, are resilient to severe macrofinancial shocks, although most banks would make use of capital conservation buffers.
- Mutual financial cooperation arrangements among banks act as a shock absorber for idiosyncratic shocks, but high financial interlinkages may fuel loss propagation in a systemic event.
- Robust regulatory framework and prudential policy actions have lowered financial stability risks, but notable challenges remain.

### Risks and vulnerabilities
- High interconnectedness across financial institutions increases potential for loss propagation in systemic events.
- Exposure to cross-border risks and money-laundering risks is highlighted as a continuing vulnerability.
- Resource constraints, data and regulatory gaps constrain effective oversight and risk monitoring.

### Stress testing and resilience
- Banks are generally resilient to severe macrofinancial shocks at the aggregate level.
- Most banks would rely on capital conservation buffers under severe stress scenarios.
- Recommendation to enhance the stress testing framework to consider second round effects and contagion.

### Data, supervision, and regulatory gaps
- Identified gaps in data collection on:
  - foreign exposures,
  - nonfinancial corporates,
  - real estate.
- Need to strengthen supervision of related party, group-wide, and money-laundering risks.
- Supervisors should be enabled to take timely action to correct unsustainable risk taking, including unsustainable lending and business models.
- Authorities should enhance monitoring and oversight related to contagion/spill over risks.

### Policy recommendations (enumerated)
- Enhance the stress testing framework to explicitly consider:
  - second round effects,
  - contagion across institutions.
- Improve data collection on:
  - foreign exposures,
  - nonfinancial corporates,
  - real estate.
- Strengthen supervision of:
  - related party risks,
  - group-wide risks,
  - money-laundering risks.
- Ensure supervisors have capacity and tools to take timely corrective action against unsustainable lending and business models.
- Enhance monitoring and oversight related to contagion and spillover risks.

---

## Content in this bundle

- **1autea2020001 - Executive Summary**
  - [1autea2020001 - Executive Summary (Markdown version)](/-/media/files/publications/cr/2020/english/1autea2020001.pdf.md){rel="alternate" type="text/markdown"}
  - [1autea2020001 - Executive Summary (PDF)](/-/media/files/publications/cr/2020/english/1autea2020001.pdf){rel="external" type="application/pdf"}

---

_Source: https://www.imf.org/en/publications/cr/issues/2020/01/31/austria-financial-stability-assessment-press-release-staff-report-and-statement-by-the-49010_