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Risk landscape 10 years on: The end of systemic risk or a new beginning?

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  • Wilson, Thomas C.

Abstract

Risk professionals currently put systemic economic risk at its lowest level since 2008, potentially owing to systemic regulatory reform and monetary policy, which have remediated issues with consumer and bank sector balance sheets. In spite of this progress, there is an argument to be made that systemic risk is actually increasing, but driven today by the public sector through high-risk monetary and public policy. The changing source of potential future systemic risks brings into question the potential effectiveness of systemic regulation. Fortunately, best risk management practices remain the same regardless of the source of the next systemic crisis, including stress testing, defining systemic risk appetite and building resilience.

Suggested Citation

  • Wilson, Thomas C., 2019. "Risk landscape 10 years on: The end of systemic risk or a new beginning?," Journal of Risk Management in Financial Institutions, Henry Stewart Publications, vol. 12(2), pages 108-114, March.
  • Handle: RePEc:aza:rmfi00:y:2019:v:12:i:2:p:108-114
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    More about this item

    Keywords

    systemic risk; stress testing; risk appetite; financial resilience; own risk; solvency assessment;
    All these keywords.

    JEL classification:

    • G2 - Financial Economics - - Financial Institutions and Services
    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit

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