EU: New Early Warning System Against Financial Market Risks
Two Austrian officials point out the relevance of the new institution, which will particularly benefit Austria.
EU: New Early Warning System Against Financial Market Risks / Picture: © Wikimedia Commons / Blackfish [CC BY-SA 3.0 (https://creativecommons.org/licenses/by-sa/3.0)]
The European Systemic Risk Board, an early warning system for financial market risks held today its inaugural session. Austria is represented in this committee by the Governor of the Oesterreichische Nationalbank (OeNB) Univ.-Prof. Dr. Ewald Nowotny and the Member of the Board of the Financial Market Authority FMA, Helmut Ettl.
The main role of the ESRB is to provide a thorough analysis of systemic risks to the financial system in the EU and issue alerts when significant risks are identified. Besides, it will make policy recommendations on how these risks can be avoided, so that renewed growth of excessive risks to the financial system as a whole may be avoided.
"With the ESRB, Europe receives -in addition to the ECB, responsible for price stability- another important institution that has been set up solely for the stability of the financial market", OeNB Governor Nowotny said about today's meeting.
FMA member of the board Ettl expects that the new body will address cross-border developments relevant to the problems on the financial market. A good example, according to Ettl, are foreign currency loans that have already been in the sights of Austria's supervision, but have also gained great importance in Central and Eastern Europe. Due to the large involvement of Austrian banks and the export sector in the CEE region, Austria has a particular interest in financial market stability.