The Riksbank’s financial stability tasks
One of the Riksbank's tasks is to promote a safe and efficient payment system. This means that the Riksbank shall contribute to the stability of the financial system and ensure that it is possible to make payments safely and efficiently.
The Riksbank's practical work on safeguarding financial stability consists of several different tasks, namely:
- issuing banknotes and coins
- ensuring that there is a central payment system (RIX) which banks and other agents can use to make payments
- working to prevent financial crises, among other means through communication, as well as analyses and oversight of the financial system
- being prepared and having tools in place to manage a financial crisis, should one arise.
What is financial stability?
The Riksbank has chosen to define financial stability as meaning that the financial system can maintain its basic functions and also has resilience to disruptions that threaten these functions. The fundamental functions of the financial system are mediating payments, converting savings into funding, and managing risk – read more about this on the page The financial system.
Financial stability and monetary policy are interlinked
A stable financial system is a prerequisite for the Riksbank to be able to conduct an effective monetary policy. This is because the financial markets and the way they function affect the impact that monetary policy has on the interest rates that households and companies pay on their loans. Moreover, the economic consequences of a financial crisis would directly affect price stability, growth and employment.
Shared responsibility for financial stability
The Riksbank shares responsibility for financial stability with Finansinspektionen, the Swedish National Debt Office and the Government via the Ministry of Finance. The Ministry of Finance is responsible for regulating financial undertaking corporations. Finansinspektionen has responsibility for microprudential policy (which focuses on the health of individual financial undertaking corporations) and for macroprudential policy (which deals with uncovering, analysing and counteracting risks in the financial system as a whole). The Swedish National Debt Office is a support and resolution authority (resolution means that the government, via the Swedish National Debt Office, can take control of institutions that are suffering problems in order to reconstruct or wind them up in a controlled manner.
The interaction between the authorities is important both in the preventive work and in the event of crisis management. The same also applies internationally, as financial enterprises increasingly frequently operate across national borders. The Riksbank, the Ministry of Finance, Finansinspektionen and the Swedish National Debt Office regularly meet to discuss issues of financial stability and how financial imbalances can be counteracted.