Finland: Financial Sector Assessment Program-Technical Note on Macroprudential Policy Framework and Tools
IMF Staff Country Reports, February 1, 2023
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Bibliographic details
- Published: February 1, 2023
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400230547.002
Institutional framework and governance
- The institutional framework for macroprudential policy in Finland was formalized in 2014 and is "mostly in line with the IMF guidance for effective macroprudential policymaking."
- Systemic risk monitoring is well organized and conducted on a timely basis, especially in the household sector.
- Authorities have taken measures to contain risks related to the housing sector.
Key systemic vulnerabilities and risks
- The sustained increase in residential housing loans is identified as "of important systemic concern."
- Household indebtedness and income data limitations are being addressed through the ongoing development of Finland’s positive credit register, which "will provide microdata on household indebtedness and income."
- Corporate sector vulnerabilities require further development of analysis and remediation of related data gaps.
Data, monitoring, and analytics
- The positive credit register under development is expected to:
- Provide microdata on household indebtedness and income.
- Be useful to analyse vulnerabilities and to calibrate macroprudential policy.
- Be useful to authorities when considering the distributional consequences of macroprudential policies.
- Current strengths: timely and well-organized systemic risk monitoring in the household sector.
- Current weaknesses: corporate sector vulnerability analysis is less developed than household sector analysis; related data gaps should be addressed.
Policy implications and recommendations
- Continue strengthening the positive credit register to enable granular microdata analysis for policy calibration and distributional assessment.
- Further develop analysis of corporate sector vulnerabilities to the same standard as household sector analysis.
- Address identified data gaps that hinder comprehensive systemic risk assessment across sectors.
- Maintain and refine macroprudential measures aimed at containing systemic risks stemming from the sustained increase in residential housing loans.
Source: Finland: Financial Sector Assessment Program-Technical Note on Macroprudential Policy Framework and Tools
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