Regulatory Alerts2026-07-01
Added · Updated
Thirteenth AFS Report on Financial Stability in Germany – Geopolitical Tensions Increase Uncertainty for the Financial System
The German Financial Stability Committee (AFS) issued its thirteenth report for the period April 2025 to March 2026, highlighting that geopolitical tensions, particularly the Iran conflict, and high uncertainty are increasing risks for the German financial system. The report notes that while the banking sector remains resilient, credit risks in the corporate sector could rise due to high energy prices and economic stagnation, necessitating strengthened defenses against cyber threats and hybrid dangers. To maintain stability, the AFS deems the current macroprudential measures, including a 0.75% countercyclical capital buffer and a 1.0% sectoral systemic risk buffer for residential mortgages, appropriate and will continue to monitor developments for potential adjustments.