Countercyclical capital buffer 2014 Q4
Norges Bank has submitted its quarterly advice on the level of the countercyclical capital buffer requirement for banks to the Ministry of Finance. The advice will be published when the Ministry has issued its decision. The decision basis for Norges Bank's advice is presented in the December 2014 Monetary Policy Report.
House prices have risen markedly through autumn, and household debt is still rising somewhat faster than household income. There are signs that banks are easing credit standards for the household sector. Corporate debt growth, on the other hand, is low and the fall in oil prices has increased the risk of considerably weaker developments in the Norwegian economy.
"The analysis in the Report indicates that financial imbalances as a whole are not building up further. Should house prices continue to rise markedly faster than household income, imbalances may increase again", says Governor Øystein Olsen.
The buffer rate was set at 1 percent in December 2013, effective from 30 June 2015. Banks have posted solid earnings so far this year and are well positioned to meet future capital requirements.
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Interest rate decision and Monetary Policy Report 4/14