Romania: Financial Sector Assessment Program-Technical Note-Systemic Risk Analysis and Stress Testing the Financial Sector

June 8, 2018

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Format: Chicago

Romania: Financial Sector Assessment Program-Technical Note-Systemic Risk Analysis and Stress Testing the Financial Sector, (USA: International Monetary Fund, 2018) accessed November 21, 2024

Summary

This Technical Note discusses the results of systemic risk analysis and stress testing of Romania’s financial sector. Although the Romanian banking sector has a strong initial capital position, banks are affected significantly by the realization of the shocks captured by the scenarios. The stress test results indicate that an extreme but plausible adverse scenario would have a significant negative impact on the capital ratios of the banking system. Although the banking sector as a whole maintains capital ratios above the minimum regulatory requirements, several (smaller) banks prove vulnerable. The extreme adverse scenario reflects downside external risks as well as a domestic demand shock impacting private consumption and investment.

Subject: Banking, Commercial banks, Credit, Financial institutions, Financial regulation and supervision, Financial Sector Assessment Program, Financial sector policy and analysis, Liquidity requirements, Loans, Money, Stress testing

Keywords: A number of bank, Balance sheets, Banks' exposure, Banks in the network, Capitalization ratios, Central bank, Commercial banks, CR, Credit, Defaulting bank, Demand shock, Europe, Foreign currency, Global, ISCR, Liquidity requirements, Loans, Longer-term liquidity position, Monetary policy, OSII bank, Parent bank, Resilience to external shocks, Sovereign-bank nexus, Stress testing

Publication Details

Pages:

63
Volume:

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DOI:

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Issue:

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Series:

Country Report No. 2018/163
Stock No:

1ROMEA2018006
ISBN:

9781484360729
ISSN:

1934-7685

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