Country Reports
2017
April 13, 2017
Kingdom of the Netherlands-Netherlands: Financial Sector Assessment Program:: Technical Note-Securities Supervision-Selected Issues Regarding the Regulators, Auditor Oversight, and Collective Investment Scheme Management
Description: This Technical Note discusses the findings and recommendations of the Financial Sector Assessment Program for the Netherlands regarding auditor oversight, collective investment fund management, and regulatory issues. The legal regime and the day-to-day supervision activities conducted by the Netherlands Authority for the Financial Markets and the Dutch central bank are extensive and consistent with international expectations. The approach to the supervision of the small but growing crowd-funding sector strikes a fair balance between enhancing innovation and protecting investors. The Dutch regime for audits and auditor oversight also complies with the expectations of the International Organization of Securities Commissions and appears to work well in practice.
April 13, 2017
Kingdom of the Netherlands-Netherlands: Financial Sector Assessment Program:: Technical Note-Financial Safety Nets-Managing Problem Banks and Systemic Banking Crises
Description: This Technical Note discusses the findings and recommendations made in the Financial Sector Assessment Program for the Netherlands in the areas of managing problem banks and systemic banking crises. Significant progress has been made toward implementing the Banking Union, although key aspects have not yet been completed. The Single Resolution Board (SRB), which assumed responsibility in January 2016, remains in start-up mode, and the Dutch central bank provides substantial support to Dutch banks. Another challenge is the complex decision-making structure of the SRB, which may impede timely decision making when it comes to resolution. The adequacy of financial safety nets remains a concern.
April 13, 2017
Georgia: Request for Extended Arrangement Under the Extended Fund Facility and Cancellation of Stand-By Arrangement-Press Release; Staff Report; and Statement by the Executive Director for Georgia
Description: This paper discusses Georgia’s Request for Extended Arrangement under the Extended Fund Facility and Cancellation of Stand-by Arrangement (SBA). The authorities in Georgia have formulated a comprehensive program to preserve macro and financial stability and advance structural reforms to bolster growth. The program envisions fiscal consolidation over the medium term, anchored in keeping debt at its current level while shifting spending toward capital investment to address infrastructure bottlenecks. The IMF staff supports the authorities’ request for the approval of the three-year Extended Arrangement under the Extended Fund Facility and the cancellation of the SBA arrangement.
April 13, 2017
Kingdom of the Netherlands-Netherlands: Financial Sector Assessment Program:: Technical Note-Regulation,Supervision, and Oversight of Financial Market Infrastructures-Responsibilities and EUROCCP Financial and Operational Risk Management
Description: This Technical Note discusses the findings and recommendations in the Financial Sector Assessment Program for the Netherlands on regulation, supervision, and oversight of financial market infrastructures (FMIs), whose supervision has been significantly strengthened in recent years. Good progress has been made to ensure that FMIs across the European Union, including in the Netherlands, are subject to a common regulatory framework. It is suggested that the Dutch central bank review the allocation of resources across various FMIs. The European Central Counterparty N.V. should also prioritize recruitment of a third Management Board member to ensure an effective board.
April 13, 2017
Kingdom of the Netherlands-Netherlands: Financial Sector Assessment Program:: Technical Note-Macroprudential Policy Framework
Description: This Technical Note discusses the findings and recommendations in the Financial Sector Assessment Program for the Netherlands on the macroprudential policy framework. The authorities have strengthened the institutional arrangement for macroprudential policy by enhancing the Netherlands Bank’s legal mandate and establishing the Financial Stability Committee, but there is room for improvement. The authorities’ analysis of systemic vulnerabilities is sophisticated and timely. The authorities have been using the range of macroprudential instruments at their disposal, but further tightening will be necessary to contain a potential buildup of systemic risk in the financial system.
April 13, 2017
Kingdom of the Netherlands-Netherlands: Financial Sector Assessment Program:: Technical Note-Insurance and Pension Sectors
Description: This Technical Note discusses the findings and recommendations in the Financial Sector Assessment Program for the Netherlands on the insurance and pension sectors. The governance, accountability, and internal processes of the supervisors, operating under a well-functioning twin-peaks model, are robust. With two-tier boards that include independent members, and an internal audit department, the governance structure of both supervisors is vigorous. Detailed documentation supports the internal processes. Discussions are underway to determine a new structure for the pension system, which may include shifting risks to the participants.
April 13, 2017
Kingdom of the Netherlands-Netherlands: Financial Sector Assessment Program:: Technical Note-Financial Stability and Stress Testing of the Banking, Household, and Corporate Sectors
Description: This Technical Note discusses the findings and recommendations in the Financial Sector Assessment Program for the Netherlands on financial stability and stress testing of the banking, household, and corporate sectors. The Dutch banking system appears resilient to risks. The stress test results indicate that a scenario of extreme adverse macroeconomic conditions would have a significant negative impact on Basel III fully loaded capital ratios, but all banks would maintain capital ratios above minimum regulatory requirements. However, the results for the leverage ratio show that a significant bank could fall just below the fully loaded minimum 3 percent hurdle.
April 13, 2017
Kingdom of the Netherlands-Netherlands: Financial Sector Assessment Program:: Technical Note-Banking Supervision
Description: This Technical Note discusses the findings and recommendations in the Financial Sector Assessment Program for the Netherlands on banking supervision. The financial resilience of banks in the Netherlands has been strengthened in recent years, and banks are benefiting from continuing economic recovery. Broad-based economic recovery is helping stimulate demand for credit, although credit growth remains slow and unemployment continues to fall. Housing markets have started to recover since 2013 with prices and transaction volumes picking up. There has been an improvement in the financial position of Dutch banks. Cost efficiency has improved, and profitability has recovered. The banks migration to the new Basel III standards is also well underway for capital adequacy and liquidity.
April 10, 2017
Qatar: 2016 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Qatar
Description: This 2016 Article IV Consultation highlights the adverse impact of lower hydrocarbon prices on the macroeconomic performance of Qatar. Growth has slowed despite still-resilient nonhydrocarbon activity. Real GDP growth of 2.7 percent is estimated for 2016. Inflation remained low despite subsidy cuts, averaging about 2.7 percent in 2016. Growth is expected to slow in the medium term as public investment growth tapers off and hydrocarbon output continues to slow. Further subsidy cuts, a moderate recovery in global commodity prices, and the introduction of a value-added tax are expected to improve the fiscal and external balances gradually over the near to medium term.
April 10, 2017
Qatar: Selected Issues
Description: This Selected Issues paper discusses measures required to enhance nonhydrocarbon revenue to support fiscal consolidation in Qatar. Qatar depends heavily on the hydrocarbon sector for exports and revenue receipts. The authorities have embarked on fiscal consolidation, underpinned by cuts to current expenditures and enhanced efforts to raise additional revenue. Safeguarding Qatar’s wealth to ensure intergenerational equity and ensure adequate resources for the implementation of the second National Development Strategy would entail increased mobilization of nonhydrocarbon revenue in the near to medium term. Exploring other sources of tax revenue to diversify the government revenue structure and build a stable tax revenue base is also critical.