Financial Stability In An Evolving Regulatory And Supervisory Landscape

Author/Editor:

Yingbin Xiao

Publication Date:

February 25, 2013

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

This paper runs qualitative and quantitative analyses of the financial soundness of Danish banks. Helped by a series of Denmark’s financial policy initiatives, banks have made progress in improving financial stability. However, vulnerabilities remain. To mitigate risks, banks should continue to build more robust capital and liquidity buffers, and enhance further the transparency of disclosures. The flexibility embedded in EU regulations should be used to design strong prudential policies, treating Basel III and the CRD IV regulations as floors. Crisis prevention and management could be further strengthened by phasing out gradually deferred-amortization mortgage loans and introducing risk-adjusted deposit insurance premia.

Series:

Working Paper No. 2013/047

Subject:

Banking Collateral Covered bonds Financial institutions Financial sector policy and analysis Financial sector stability Loans Mortgages

English

Publication Date:

February 25, 2013

ISBN/ISSN:

9781475529661/1018-5941

Stock No:

WPIEA2013047

Pages:

18

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