How Stable Is the Nordic Financial Sector?

Jesper Rangvid*

*Corresponding author for this work

Research output: Chapter in Book/Report/Conference proceedingBook chapterResearchpeer-review

Abstract

The Nordic financial sectors were challenged during the early 1990s and in 2008. The crises were costly, with losses in terms of foregone GDP accumulating to, in some cases, two years of economic output (GDP). High credit growth and real estate booms, preceded by financial liberalizations, caused the crises. There were many similarities across the Nordics, but also some important differences. Currently, credit growth is low and banks are well capitalized. Traditional indicators of financial crises are not flashing red. On the other hand, house prices and household debt levels are elevated. Risks resulting from low interest rates are also discussed.
Original languageEnglish
Title of host publicationFinancial Regulation and Macroeconomic Stability in the Nordics
Number of pages29
Place of PublicationCopenhagen
PublisherNordic Council of Ministers
Publication date2020
Pages21-49
ISBN (Print)9789289365659
ISBN (Electronic)9789289365666, 9789289365673
DOIs
Publication statusPublished - 2020
SeriesNordic Economic Policy Review
Volume2020
ISSN1904-4526
SeriesNord
Number2020:025
ISSN0903-7004

Keywords

  • Credit growth
  • House prices
  • Household debt
  • Capitalization of banks
  • Financial regulation
  • Low interest rates

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