IMF Staff Country Reports

Belgium: Financial Sector Assessment Program-Technical Note on Macroprudential Policy Framework and Tools

December 8, 2023

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Belgium: Financial Sector Assessment Program-Technical Note on Macroprudential Policy Framework and Tools, (USA: International Monetary Fund, 2023) accessed November 21, 2024

Summary

Despite a series of shocks in the recent past, the Belgian financial sector has remained resilient and firm evidence for sustained credit or real estate price booms is limited. The profitability, capital adequacy and liquidity of banks have surpassed their pre-pandemic levels, remaining comfortably above regulatory thresholds. Notwithstanding the blows to the economy inflicted by the pandemic, spillovers from Russia’s war in Ukraine, and the energy crisis, bankruptcies have not materialized, and the quality of loan portfolios has stayed strong as automatic wage indexation and government support have helped households and firms. The credit gap turning positive in late 2017 did not herald the beginning of a prolonged period of further widening, with private sector borrowing expanding at a robust pace until the rapid tightening of financial conditions since 2022 triggered an ebbing of lending growth. Prices for residential and commercial dwellings have steadily increased since 2014, yet market dynamism over this period has been generally below developments seen in other euro area countries, keeping valuations in check.

Subject: Financial sector policy and analysis, Financial sector risk, Financial sector stability, International organization, Macroprudential policy, Macroprudential policy instruments, Monetary policy, Systemic risk

Keywords: Bank CRE exposure, Bank funding, Coverage ratio, Europe, Financial sector risk, Financial sector stability, Global, Housing loan, Macroprudential policy, Macroprudential policy instruments, Mortgage market characteristic, NBB proposal, Systemic risk

Publication Details

  • Pages:

    48

  • Volume:

    ---

  • DOI:

    ---

  • Issue:

    ---

  • Series:

    Country Report No. 2023/392

  • Stock No:

    1BELEA2023010

  • ISBN:

    9798400262340

  • ISSN:

    1934-7685

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