Evolution of the Financial Stability Reports – Theoretical Approach
Evolution of the Financial Stability Reports – Theoretical Approach

Author(s): Aleksandra Nocoń
Subject(s): Business Economy / Management, Economic policy, Accounting - Business Administration
Published by: Masarykova univerzita nakladatelství
Keywords: financial stability report; central bank; monetary policy; communication system;
Summary/Abstract: Over the last decade, financial stability has become the overriding objective of central banks’ monetary policy. Monetary authorities as well as governments paid particular attention to the need to maintain stability of the financial system. The main reason were the negative consequences of the global financial crisis as well as new types of risk, appearing as a result of financial markets and instruments development, increased financial institutions’ propensity to undertake excessive risk and persistently high level of systemic risk. One of the visible signs of increased interest in the issue of financial stability is growing number of Financial Stability Reports (FSR), published by central banks. Moreover, after the outbreak of the global financial crisis, production of these reports is a rapidly growing "industry" (Čihák, 2006, p. 4; Čihák et al., 2012, p. 5). The main aim of the paper is the analysis of the evolution of the Financial Stability Reports (FSR) into more preventive tool for identifying how central banks contribute to financial stability and what kind of actions they undertake in this field. Moreover, the study points out that the Financial Stability Reports should be characterized by the proactive approach, which means that they should meet the changing external conditions, adapt to identified new areas of risk that may potentially have a negative impact on the financial system's condition, and at the same time systematically assess quality of central banks’ actions, in order to improve them.

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