The European Banking Authority (EBA), the European Securities and Markets Authority (ESMA) and the European Insurance and Occupational Pensions Authority (EIOPA) published, on Monday 18 September, their joint committee report for autumn 2023. Faced with “continuing high levels of economic uncertainty”, the report calls on financial market players to redouble their vigilance, and on the national competent authorities to put in place a series of policy measures.
Against a background of “fragile economic prospects” and after years “marked by a series of adverse events”, the report recommends that financial institutions and supervisory authorities should closely monitor “the broader impact on financial institutions and market participants from strong increases in policy interest rates and sudden rises in risk premia”.
They should also “remain prepared for a deterioration in asset quality in the financial sector“ and “closely monitor the impact of inflation risk”, which “not only impacts financial institutions by its effects on asset quality and valuation, but also through rising expenditures and rising funding costs”.
To see the report: https://aeur.eu/f/8nr (Original version in French by Thomas Mangin)