Press release 22 March 2016 – 5/2016

Macroprudential decision: FIN-FSA will not increase the countercyclical capital buffer requirement applicable to banks, and continues its preparations for setting higher risk weights on housing loans

The Board of the Financial Supervisory Authority (FIN-FSA) has decided not to increase the countercyclical capital buffer requirement (variable capital add-on) referred to in chapter 10, section 4 of the Credit Institutions Act. Consequently, the countercyclical capital buffer requirement remains at 0.0%. Preparations will continue with a view to increasing average risk weights on housing loans of banks that have adopted the Internal Ratings Based Approach.Overall, cyclical systemic risks to the Finnish financial system have remained unchanged. The primary risk indicator, i.e. the credit-to-GDP gap, has declined. Nor are supplementary risk indicators signalling an increase in financial system vulnerabilities.

According to a previous decision of the Board of FIN-FSA (22 December 2015), preparations for setting higher risk weights on housing loans are continuing.

The Board of FIN-FSA made its decision upon a proposal by the Director General of FIN-FSA and after consultation with the Bank of Finland, the Ministry of Finance and the Ministry of Social Affairs and Health. In accordance with the regulations governing the Single Supervisory Mechanism, the European Central Bank was also consulted in respect of the decision.

For further information, please contact

Pentti Hakkarainen, Chairman of the Board of the Financial Supervisory Authority, tel. +358 10 831 2002.

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