Norway:Financial Sector Assessment Program-Technical Note-Systemic Liquidity

Financial Sector Assessment Program-Technical Note-Systemic Liquidity
READ MORE...
Volume/Issue: Volume 2020 Issue 264
Publication date: August 2020
ISBN: 9781513553177
$18.00
Add to Cart by clicking price of the language and format you'd like to purchase
Available Languages and Formats
English
Prices in red indicate formats that are not yet available but are forthcoming.
Topics covered in this book

This title contains information about the following subjects. Click on a subject if you would like to see other titles with the same subjects.

Banks and Banking , Finance , ISCR , CR , spot market , commercial paper , cross holdings , FX swap market , liquidity support , government bond , central bank , U , S , dollar , secondary market , mortgage loan , government bond market , market development , Liquidity , Covered bonds , Currency swaps , Sovereign bonds , Collateral , Global

Summary

Norwegian banks and other financial institutions rely heavily on capital markets for liquidity and risk management. Liquidity conditions in the Norwegian financial sector are affected by central bank operations and the lending and funding activities of financial institutions, both domestically and abroad. Nearly 40 percent of the funding of Norwegian banks is obtained from market sources, using commercial paper, covered bonds, and senior unsecured bonds issued both domestically and abroad. Correspondingly, money markets, foreign exchange (FX) swap markets and bond markets are crucial to the credit intermediation process and a dislocation in these markets—the inability of financial institutions to roll over, or obtain new, funding—could have significant consequences for financial stability. Against this background, this note analyzes core funding markets for Norwegian banks and assesses Norges Bank’s capacity to manage systemic liquidity conditions and counteract liquidity shocks in normal times and in times of stress.