Crisis management in connection with a financial crisis
It is important to have good crisis management to ensure that the costs to society are not too high in the event of a financial crisis.
The Riksbank can manage a financial crisis in different ways:
- by supplying liquidity to the financial system, for example by providing money to support a bank
- by communicating the Riksbank's assessments
- by cooperating with other authorities in Sweden and abroad
In a crisis there is often a shortage of liquid funds because the financial markets that offer funding work less efficiently than normal as a result of declining confidence. This uncertainty means that the liquidity that still exists in the financial system is not redistributed in the same way as in a normal situation. In such a situation, the Riksbank has several ways of quickly adding liquidity to the system. This can involve providing money to support a particular bank or more general liquidity support measures aimed at several participants, such as offering loans at longer maturities or in currencies other than Swedish kronor.
Communication in a crisis
Communication and information are central elements of the Riksbank's crisis management. By providing open and clear communication on problems and measures, the Riksbank can help to create confidence in the financial system in a crisis situation.
If there is unease or a crisis in the financial system, the Riksbank's overall assessments of financial stability need to be presented more rapidly and more often. If communication is to be clear, it is particularly important to carefully consider what is to be communicated, when this communication is to take place and how.