Financial Stability And Macroeconomic Balances: Challenges And Perspectives

Financial stability is a global public good characterized by non-equity and non-exclusion. This public good cannot be offered exclusively by the market, the central bank and other state institutions playing an important role in ensuring financial stability. Also, given the open economy of Romania, a cross-border approach is needed, by coordinating policies in this area, in order to achieve financial stability at national level. The National Bank of Romania designs macro-prudential policy strategy within the limits of its area of competence. The macro-prudential policy objectives of the NBR, fully harmonized with the European recommendations in the field, are: (i) to reduce and prevent excessive credit and debt growth; (ii) reducing and preventing excessive maturity mismatches and lack of liquidity on the market; (iii) limiting the concentration of direct and indirect exposures; (iv) limiting moral hazard, and (v) enhancing the resilience of financial infrastructure. In order to meet the ultimate goal of safeguarding the stability of the financial system, the NBR selected, in addition to the interim macro-prudential policy objectives at EU level, two specific national targets - sustainable growth of financial intermediation and improvement of financial inclusion - for which it proposed specific instruments.