Regulatory Alerts2013-04-04
Added · Updated
Recommendation on intermediate objectives and instruments of macro-prudential policy
The European Systemic Risk Board recommends that macro-prudential authorities define intermediate objectives to mitigate excessive credit growth, leverage, maturity mismatch, exposure concentrations, and moral hazard, while strengthening financial infrastructure resilience. Member States are advised to ensure these authorities possess direct control or recommendation powers over a sufficient set of instruments, such as counter-cyclical capital buffers and loan-to-value limits, to pursue these objectives. Authorities must establish a coherent policy strategy linking objectives to instruments, conduct periodic evaluations of their effectiveness, and report on implementation actions to the ESRB, the European Banking Authority, and the Council by specified deadlines in 2014 and 2015.