Eleventh meeting of the Financial Market Stability Board

In its eleventh meeting on March 15, 2017, the Financial Market Stability Board (FMSB) once more focused on sustainable real estate financing. Also, it recommended keeping the countercyclical capital buffer rate at 0% of risk-weighted assets and discussed its Annual Report for 2016 as well as the road map for its meetings in 2017.

FMSB welcomes talks with banks about sustainable real estate lending

In the meeting, the FMSB again addressed the issue of sustainable real estate lending to households. In this context, it welcomed related talks between the Austrian Financial Market Authority (FMA), the Oesterreichische Nationalbank (OeNB) and Austrian banks. The FMSB advocated improving the availability of data on real estate loans and legally implementing the expansion of the macroprudential toolkit as recommended in the advice issued in June 2016. These measures would equip macroprudential supervision with appropriate instruments to react to systemic risks arising from real estate financing. Currently, the FMSB sees no immediate need for action but decisively calls on banks to continue to pay particular attention to sustainability in new lending. The FMSB will continue to address this topic in the course of 2017.

FMSB recommends keeping the countercyclical capital buffer rate at 0%

The FMSB recommends that the FMA maintain the countercyclical capital buffer rate of 0% of risk-weighted assets also from July 1, 2017. The main indicator, which reflects credit volume relative to gross domestic product, is negative and therefore does not point to excessive credit growth.

FMSB Annual Report for 2016 to be published in end-April

The FMSB also discussed its Annual Report for 2016. Once the year-end figures for the finance sector can be included at the end of April, the report will be submitted to the Finance Committee of parliament and the Federal Minister of Finance and subsequently published on the FMSB’s website.

Information on the FMSB

The FMSB, which became operational in 2014, works toward strengthening financial stability. Its members are representatives of the Austrian Federal Ministry of Finance, the Fiscal Advisory Council, the Financial Market Authority and the Oesterreichische Nationalbank. The FMSB may issue recommendations to the Financial Market Authority and provide risk warnings.