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The Stress Test - A New Challenge For The Banking Union

Author

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  • Lucian Ciprian Crisan

    (Faculty of Economics and Business Administration)

Abstract

Stress testing has become an essential and very prominent tool in the analysis of financial sector stability and development of financial sector policy. Starting with 2010 stress test led by the Committee of European Banking Supervisors (CEBS), and reinforced by 2011 stress test and the bank recapitalization exercise led by the European Banking Authority (EBA), the output of EU wide stress tests has been viewed as essential information on the health of the system.The purpose of this paper is to highlight the main elements considered by the EBA and European Central Bank (ECB) in creating the model of the stress test. At the same time it will highlight how the recent financial crisis has influenced the introduction of these decisions in order to stabilize the banking system. The vision of a future banking union will reshape and resize the entire European system profile. Applying stress test will lead to a healthy and robust banking system even if a new potential crises will come.

Suggested Citation

  • Lucian Ciprian Crisan, 2014. "The Stress Test - A New Challenge For The Banking Union," Proceedings of International Academic Conferences 0702690, International Institute of Social and Economic Sciences.
    • Handle: RePEc:sek:iacpro:0702690
    as

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    File URL: https://iises.net/proceedings/12th-international-academic-conference-prague/table-of-content/detail?cid=7&iid=32&rid=2690
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    References listed on IDEAS

    as
    1. Hennie Van Greuning & Sonja Brajovic Bratanovic, 2003. "Analyzing and Managing Banking Risk : A Framework for Assessing Corporate Governance and Financial Risk Management, Second Edition," World Bank Publications - Books, The World Bank Group, number 14949, December.
    2. Marco Sorge, 2004. "Stress-testing financial systems: an overview of current methodologies," BIS Working Papers 165, Bank for International Settlements.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Banking Union; Stress test; financial crisis; Challenge; Basel philosophy;
    All these keywords.

    JEL classification:

    • E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General
    • F50 - International Economics - - International Relations, National Security, and International Political Economy - - - General

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