We investigate the performance of different variables as anchors for setting the level of the countercyclical regulatory capital buffer requirements for banks. The gap between the ratio of credit-to-GDP and its long-term backward-looking trend performs best as an indicator for the accumulation...

This paper provides some general lessons for the design of counter-cyclical capital buffers. Its main empirical contribution is to analyze conditioning variables which could guide the build-up and release of capital. A major distinction for counter-cyclical capital schemes is whether...

In the present short paper author attempts to point out econometrically the importance of banking sector viability and household consumption as a requirement for economic growth. In the recent financial crisis many economies are facing the danger of financial collapse. The remedy is difficult,...

We examine the issue of the appropriate selection of macroprudential instruments according to the vulnerabilities identified and the policymakers' objectives using a version of the 3D DSGE model following Mendicino et al. (2020) and Hinterschweiger et al. (2021) calibrated for the euro area. We...

In the present short paper author attempts to point out econometrically the importance of banking sector viability as a requirement for economic growth. In the recent financial crisis many economies are facing the danger of financial collapse. The remedy is difficult, cold minded policy-makers...