This FI Analysis describes how vulnerabilities from lending to non-financial firms arise and why FI needs to follow them to fulfil its assignment to safeguard financial stability.
On Tuesday, 26 January, TRS 2 will be closed for maintenance.
Due to the United Kingdom’s withdrawal from the European Union, financial actors’ right to conduct cross-border operations in or from the United Kingdom that are based on European Union law was repealed on 1 January 2021.
As of 1 January 2021, FI will implement new procedures for how it announces opened and closed supervision investigations.
Single-adult households with children continue to have a more difficult financial situation than other households. FI has measured households’ financial literacy and found that it has improved in almost all areas compared to previous surveys.
In light of the economic uncertainty caused by the ongoing coronavirus pandemic, FI expects banks, including credit institutions and other financial firms such as insurance companies, to be restrictive with dividends and share buybacks until 30 September 2021. During this period, total dividends from and buybacks by the banks should not exceed 25 per cent of their aggregate net earnings for the two financial years 2019–2020.
Due to Brexit, ESMA will have a maintenance window from 31 December 2020 through (preliminarily) 7 January 2021.
FI welcomes the Federal Reserve to the Network for Greening the Financial System (NGFS), which celebrates its third anniversary today.
What will happen in the event that the transition period ends without an agreement between the EU and the UK.
Finansinspektionen (FI) presents in this memorandum a stress test of the Swedish banks that we conducted in the autumn of 2020. The results indicate that the major banks have significant resilience to the credit losses that could arise and also a capacity to maintain the supply of credit.
The pandemic has triggered a deep economic recession in many countries, even if a slight recovery has begun. Extensive support measures have mitigated the economic impact and reduced the uncertainty on the financial markets. During the autumn, infection rates have once again begun to increase and several countries have introduced new restrictions, which will dampen the economic recovery, even though it is uncertain to which extent.
An increase in the spread of the coronavirus will dampen the recovery in European economies and, in the long run, this could impact financial stability, writes Finansinspektionen (FI) in this year’s second stability report, which will be published today.
Finansinspektionen publishes the capital requirements of the largest Swedish banks and credit institutions that belong to supervisory categories 1 and 2 as of the end of Q3 2020.
Finansinspektionen (FI) decided on 24 November not to change the countercyclical buffer rate. The buffer rate of 0 per cent, which was applied starting on 16 March 2020, shall thus continue to apply. The countercyclical buffer guide is set at 1.7 per cent.
Large credit losses can result in otherwise profitable banks reporting a loss. This FI Analysis describes a methodology for estimating how large credit losses can be in a stressed macroeconomic scenario.
FI has decided to change the application of capital requirements for Swedish banks in order to adapt to the EU’s so-called banking package.
The European Commission has announced that it does not intend to object to FI's intention to extend the current risk weight floor for Swedish mortgages. This means that FI may implement the measure.
The tax rebate for interest expenses – the interest deduction – means that households borrow more, and can and want to pay more for homes. This means that the households experience an increase in both their liabilities and assets, which in turn could have an impact on the stability of the financial system. In this FI Analysis, we calculate the impact of a change to the interest deduction. The reason for this analysis is the direct link between interest deductions and households’ loans.
Commercial real estate firms are sensitive to changes in interest rate expenses and income. Following a shock, vulnerable commercial real estate firms could lead to credit losses for the banks.
As the crisis unrolled this past spring in full force, it required fast and extraordinary measures. For example, FI lowered the countercyclical buffer requirement for the banks and encouraged them at the same time to postpone their dividend payments until the situation had become clearer. During the autumn, FI repeated its message to the banks to not make any dividend payments in 2020.
The majority of the distribution on the life insurance market occurs through external distribution channels. It is therefore important for insurance firms to fulfil their responsibility to choose suitable distribution channels for the target market and follow up that the insurance products are distributed to the proper target group.
Henrik Braconier, Chief Economist at FI, spoke on risks related to low interest rates at SNS/SHOF’s Finance Panel: Corporate Finance in a Low Interest Rate Environment.
The access of non-financial firms to credit is central for financial stability, particularly during financial crises. In recent years, the market for corporate bonds has grown steadily and currently plays an important role in firms’ financing. This analysis shows that it has not been easier to issue corporate bonds in Swedish krona during financial crises than to take a bank loan. This pattern deviates from previous research on the USA and the euro zone.
Finansinspektionen (FI) is issuing credit market company AK Nordic AB a remark. The company must also pay an administrative fine of SEK 20 million.
Finansinspektionen is issuing AK Nordic AB a remark. AK Nordic AB shall also pay an administrative fine of SEK 20,000,000.
On Friday, 16 October, from 1:00 PM to 4:00 PM, TRS 2 will be closed for maintenance.
Today, FI launches a new Short Selling Register for significant net short positions.
Erik Thedéen, Finansinspektionen's Director General and Chair of IOSCO's Task Force on Sustainable Finance made a speech at the conference Driving Global Standards on Sustainable Finance.
Even though consumer credit only constitutes a small portion of households’ total credit, the interest rate and amortisation payments for these credits amount to more than half of the households’ total debt service payments. The analysis also shows that individual consumers are having difficulty paying for their consumer credit. Overall, this means that the consumer credit market could impact many households, which makes it important for consumer protection on the financial markets.
After the provisions regarding high-cost short-term credits were changed in 2018 – in part by introducing an interest rate ceiling and cost ceiling – these types of loans decreased sharply. It is probable that the reform has led to a decrease in the supply of high-cost short-term credits. It is also evident that several companies have stopped offering such loans.