The last financial crisis significantly changed views concerning the relationship between monetary policy, asset prices and financial stability. We survey the pre-crisis opinions on the appropriate monetary policy reactions to financial market developments and delineate the new consensus which...

This article aims to open a debate on creating a macroprudential policy framework in the Czech Republic. It starts by describing how the CNB defines financial stability and what place macroprudential policy has within it. It then gives the sources of systemic risk and outlines the mechanisms...

The Czech Republic had experienced a credit boom similar to those in other converging economies in the pre-crisis years. Nevertheless, the consequences of this credit boom were limited as was the impact of the global crisis on domestic financial institutions. This paper describes the...

This paper sets out to discuss the extent of procyclicality in European banks’ lending behavior and how much the regulatory and accounting framework may contribute to it. The main focus is the behavior of banks regarding provisioning against impaired financial assets. It also discusses whether...

The paper aims at enriching current discussions about the equilibrium exchange rate level for the economy with large external debt, subdued real income growth, fragile financial sector and repeated problems with current account deficit. The main idea of the paper is to apply one of the newly...

This paper focuses on the impact of the Basel III accord on emerging, developing and small economies. It looks primarily at potential unintended consequences of the new rules. The areas of concern for both banks and regulators are found in increases in risk-weighted assets for trading exposures,...

The crisis has brought the issue of regulating large, complex and highly interconnected financial institutions back into the spotlight. Supervisory and other competent authorities have discovered that they have only limited ways of preventing an idiosyncratic shock in one institution from...

This paper focuses on the way the macroprudential policy framework in a small EU economy should be designed. With reference to the experience of the Czech Republic's financial system and the Czech National Bank it provides definitions of financial stability and macroprudential policy as well as...