Countercyclical capital buffer
Norges Bank has submitted its quarterly advice on 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 the advice is presented in the September Monetary Policy Report.
Corporate debt growth is moderate. Household debt growth is still somewhat higher than income growth, and there are signs that banks are easing credit standards for households. House prices have risen broadly in line with expectations.
"Total debt is at a high level, but recent developments suggest that financial imbalances have not built up further. Should house prices rise markedly faster than household income ahead and credit growth rise, systemic risk may increase again", says Governor Øystein Olsen.
Banks are well on the way to meeting the new capital requirements and have continued to build capital in the past quarter.
"More capital will increase banks' resilience to future loan losses", says Governor Olsen.
The buffer rate was set at 1 percent in December 2013, effective from 30 June 2015.
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