New Zealand: Financial Sector Assessment Program: Technical Note-Stress Testing the Banking Sector and Systemic Risk Analysis
Electronic Access:
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Summary:
This Technical Note discusses the results of stress testing of the banking sector and systemic risk analysis for New Zealand. The banking sector, which dominates the financial system, has significant exposure to real estate. A sharp decline in the real estate market, a prolonged period of low dairy prices, deterioration in global economic conditions, and a tightening in financial markets would adversely impact the system. Despite these risks, the banking system is resilient to severe shocks. Results of stress tests and sensitivity analysis indicate that the solvency and liquidity of the banking system can withstand adverse and severe shocks.
Series:
Country Report No. 2017/119
Subject:
Banking Commercial banks Credit Credit risk Financial institutions Financial regulation and supervision Financial Sector Assessment Program Financial sector policy and analysis Loans Money Stress testing
English
Publication Date:
May 10, 2017
ISBN/ISSN:
9781475599923/1934-7685
Stock No:
1NZLEA2017007
Pages:
79
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