Macroprudential

Bank regulation and prudential management

Macroprudential regulation means regulation for the welfare of the financial system as a whole, rather than individual financial institutions alone.

One insight from the Global Financial Crisis (GFC) was that bank viability regulation at the macro/systemic level had been dangerously neglected pre-crisis.

Examples of developments in macroprudential regulation and supervision include capital buffers.

At the individual institution level, 'macroprudential' management means recognition of the system-wide context in which the individual institution operates, and establishing risk management responses accordingly in that broader context.

See also

• Bank supervision
• Basel III
• Capital Conservation Buffer
• Countercyclical buffer
• CRD IV
• Global Financial Crisis
• Macro
• Microprudential
• Procyclicality
• Systemic risk
• Systemic Risk Buffer