In Finland, as in all Eurosystem countries, macroprudential supervision is a statutory task imposed on central banks. Promotion of stability is also laid down in the Statute of the ESCB/ECB and the Treaty establishing the European Community. The Act on the Bank of Finland requires that the Bank of Finland contribute to maintaining the reliability and efficiency of the payment system and overall financial system and participate in their development.
A stable and reliable financial system is an important prerequisite for price stability and effective economic activity in general. System stability supports the conduct of economic policies, thereby creating overall social stability. Banking crises and other serious disruptions affecting the operation of the financial system lead to high costs across economic sectors. Of key concern is therefore to identify and minimise in advance any major risks that may endanger financial stability. The Bank performs its stability-related tasks in close cooperation with national and foreign authorities.
The Bank of Finland seeks to maintain confidence in the financial system without intervening in the functioning of the system. When instability threatens, the Bank may need to take a more active role in order to ensure the operational ability of the financial system. This was the case in Finland, for instance, during the banking crisis at the beginning of the 1990s. In the end, only the central bank can safeguard the liquidity of the financial system. The Bank of Finland therefore continues to develop its capabilities for crisis management.
Central banks perform overall surveillance and analysis of the financial system (macroprudential analysis). The aim is to analyse the effects that economic developments in general have on the financial sector. Particular emphasis is laid on examining the resilience of financial markets to various shocks. Links between various financial market participants are of vital importance from the perspective of stability. Analyses are therefore undertaken to identify the effects that financial system structures, structural changes and integration developments have on financial stability. Such analyses seek to combine quantitative and qualitative information.
The Bank of Finland supervises the payment and settlement system infrastructure as a whole by regularly monitoring, analysing and assessing the status and development of the system (oversight). In performing this task, the Bank of Finland also participates in the development of payment and settlement systems. As a member of the Eurosystem, the Bank of Finland conducts its oversight functions in compliance with jointly agreed policies and requirements.
The Bank publishes its official assessment of the stability of financial markets as a special issue of the Bank of Finland Bulletin, towards the end of the year. An update of the assessment appears in the following year, in the second issue of the Bank of Finland Bulletin, released in early spring.
The Bank also publishes structural analyses and special articles on developments in various financial market sectors and in the regulatory and supervisory field. In addition, the Bank's serial publications include a number of analytical studies and reports on financial markets.
A more detailed description of Finnish payment systems and instruments is provided in the publication Finnish Financial Markets 2002, Bank of Finland Studies A:105, p. 215–265.