The global financial and economic crisis has struck Iceland with extreme force. Iceland’s three main banks, accounting … financial markets following the failure of Lehman Brothers. The banks had pursued risky expansion strategies – notably borrowing … to rescue. When access to foreign capital eventually closed, the banks failed. Non-financial firms and households were …

-owned banks. The levels of non-performing loans and capital adequacy ratios compare poorly in international perspective and may … for the two main stateowned banks in mid-2012. To foster the credibility of the new tests, the main results and underlying … by ring-fencing impaired assets, which would create conditions for an orderly resolution of non-viable banks and a rapid …

banks vulnerable to shifts in investor sentiment. However, investment and credit were mostly directed to sheltered sectors … commitments, this will require reforming public policies that have long distorted investment allocation, ensuring that banks …

Dutch banks were put under heavy strains early in the global downturn and have comparatively weak financial buffers to … adverse shocks. Banks are very large relative to the size of the domestic economy, have sizeable cross-border exposures and … taxpayer and the regulator’s tools available to reduce risks should be expanded. In particular, banks should set aside …

banking sector is sufficiently capitalised in the short term, banks are deleveraging by cutting down their dependence on cross … ban on foreign currency lending for mortgages, future uncertainties about parent banks’ funding and undermined creditors … while weakening banks’ solvency. The mid-December 2011 agreement between the government and the banking sector was a welcome …

requirements and shifts banks’ focus away from their core economic functions. Tighter capital requirements based on risk …-weighted assets may further contribute to these skewed incentives. The estimated macroeconomic costs of redirecting banks’ attention … point more than under the risk-weighted assets framework. Refocusing banks’ attention toward their main economic functions …

stress tests for banks have been ramped up. Also the identification and monitoring of systemic risks and macro …