The Financial Stability Committee approved a recommendation to the German government regarding the creation of national macroprudential instruments for the residential real estate market. They comprise additional intervention rights on the part of the supervisory authority in order to counteract credit-driven overheating on the residential real estate market and potential systemic crises in …

At its meeting on 27 May 2019, the Financial Stability Committee recommended that the Federal Financial Supervisory Authority (BaFin) activate the domestic countercyclical capital buffer (CCyB) starting in the third quarter of 2019 and increase it from zero to 0.25 per cent within 12 months.

The time series for the indicators used to set the CCyB have been updated. The time series are now available for Q2 2020.

The ESRB addresses its recommendations to national macroprudential supervisory authorities. In Germany, this is the function of the Financial Stability Committee. Accordingly, the Financial Stability Committee will participate in identifying, and sharing information related to, recommended fiscal policy actions in connection with Covid-19.

Germany’s financial supervisory authority is carefully and continuously monitoring the impact of the Covid-19 pandemic on the financial sector. BaFin has summarised what actions BaFin, the European Central Bank and the European supervisory authorities are taking in response to Covid-19 on the BaFin website.

The time series for the indicators used to set the CCyB have been updated. The time series are now available for Q1 2020.

The low interest rate environment is placing earnings pressure on many financial market players and poses a particular challenge to German life insurers. The Financial Stability Committee presented these and other topics in its first annual report to the German Bundestag on 18 June 2014.

The ECB’s expansionary monetary policies are not the only factor contributing to uncertainty concerning the financial stability situation and trends in Germany. Developments in Greece and the Russia-Ukraine conflict also play a significant role. This is explored in more depth in the Financial Stability Committee’s second report, issued on 30 June 2015.

The third Financial Stability Committee report concerned itself with more than just domestic developments. Corrections on the Chinese markets and political uncertainty triggered by the refugee crisis and Brexit are also having an impact on the German financial system.

The Financial Stability Committee presented its seventh report to the German Bundestag today. The report indicates that during the period from 1 April 2019 to 31 March 2020, the Financial Stability Committee was primarily concerned with the risk of underestimating credit risks, the low interest rate environment and property markets.