Financial Stability Review 2023/1

The Eesti Pank Financial Stability Review is released twice a year. The Financial Stability Review is Eesti Pank’s main publication analysing financial stability, and it contains an assessment of the risks to the stability of the financial system, and an outline of the macroprudential measures taken by Eesti Pank.

Financial stability means the smooth functioning of financial intermediation under both normal and unexpectedly adverse circumstances. The aim of macroprudential policy is to increase the resilience of the financial system and to avoid systemic risks to financial stability building up. Macroprudential measures help reduce the damage caused by a financial crisis to the non-financial economy.

The Financial Stability Review covers the main areas of risk and identifies possible systemic risks. As the Estonian financial system is largely bank-based, the main focus of the analysis is on risks and vulnerabilities that could substantially harm the Estonian banking sector or affect its activities.