Stability & Supervision | Finance Watch

Policy portal Stability & Supervision

When trust in the financial system disappears, panic sets in: fire sales of financial assets and bank runs can make the entire system collapse. Taxpayers are forced to bail out “too-big-to-fail” institutions to protect essential economic functions (deposits, credit, payment systems).

Mitigating implicit “moral hazard” requires sound prudential policies protecting essential banking services from excessive risk-taking and maintaining adequate capital levels to cover possible losses. Well-resourced, and independent supervision is also key. Finally, prudential regulation must also respond to new risks related to digitalisation (see “Digital Finance”) and climate change (see climate risk under “Sustainable Finance”).

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2 PUBLICATIONS

Consultation response

Response to Commission consultation on the market risk prudential framework

Open letter

Need for sustainable prosperity comes first

Letter to the Financial Times, 15 October 2015
Speech

Statement at ECON hearing on Stocktaking and challenges of the EU Financial Regulation

Finance Watch’s Secretary General, Christophe Nijdam, was invited to speak at the European Parliament’s ECON Committee public hearing on “Stocktaking and challenges of the EU Financial Services Regulation: impact and the way...

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