Macroprudential regulation and policy

BIS Papers No 60
December 2011

The Bank for International Settlements (BIS) and the Bank of Korea (BoK) jointly organised a conference on macroprudential regulation and policy in Seoul, Korea, on 16-18 January 2011. The conference aimed to bring academics together with researchers at central banks and other public institutions to present and discuss ongoing theoretical and empirical work in the field. In response to their call for papers, the organisers received more than 75 submissions from central banks, public agencies, supranational organisations and academic institutions. From these, a selection committee from the BIS and the BoK chose 12 papers organised around the following four themes: (i) systemic risk; (ii) financial system procyclicality; (iii) macroeconomic impact studies and early warning indicators; and (iv) effective implementation of macroprudential policy.

In all, 35 participants took part, including central bank economists from Asia and the Pacific, Europe, Latin America and the United States, as well as academics from Europe, Korea and North America. Governor Choongsoo Kim of the BoK gave the welcome address, and Governor Stefan Ingves of Sveriges Riksbank and Professor Hyun Song Shin from Princeton University gave keynote speeches. The conference concluded with a policy panel focusing on macroprudential policy frameworks. This volume is a collection of the welcome address, keynote speeches, revised versions of all papers presented during the conference and the panel discussions.

JEL classification: D14, E21, E52, G01, G28


Welcome address
Macroprudential policies beyond Basel III
Challenges for the design and conduct of macroprudential policy


Systemic risk measures: the simpler the better?
Systemic risk contributions
Systemic capital requirements
Monetary policy framework and financial procyclicality: international evidence
Boom-bust cycles and stabilisation policy - monetary and macroprudential rules: a loss function approach
Optimal macroprudential regulation in a Fisherian model of financial crises
The long-term economic impact of higher capital levels
Macrofinancial vulnerabilities and future financial stress: assessing systemic risks and predicting systemic events
Getting effective macroprudential policy on the road: eight propositions
Countercyclical tools: a comparative assessment
Macroprudential policy and central bank communication
Thoughts on the proper design of macro stress tests

Policy Panel on the Macroprudential Policy Framework

Macroprudential policy framework
Macroprudential policy framework
Key issues for the success of macroprudential policies
Remarks on macroprudential policy frameworks