Kerstin af Jochnick: How the Riksbank contributes to financial stability
Speech by Ms Kerstin af Jochnick, First Deputy Governor of the Sveriges Riksbank, at an event at the Sveriges Riksbank, Stockholm, 29 January 2018.
In Sweden we have a large financial system, which contributes positively to jobs and growth. But it also entails risks, not only for financial companies, but also for the entire Swedish economy. We have in modern times experienced two bank crises, which the responsible authorities have succeeded in managing in a good way, but which have in the long run lowered production levels and thus general welfare in Sweden.
Discussing what central banks and other authorities do in the field of financial stability is therefore important. Right now it is particularly interesting to discuss what the Riksbank does, as the Riksbank Committee is in the process of reviewing the Sveriges Riksbank Act. One of the areas the Committee is to analyse is precisely the Riksbank's responsibility for financial stability, and it is good that this is clarified. The current act says that the Riksbank shall "promote a safe and efficient paymentssystem". The concrete meaning of this text is not self-evident, but the Riksbank has interpreted it as a task of promoting financial stability.
Today I therefore intend to talk about what tasks the Riksbank has that contribute to promoting financial stability, and how the Riksbank works with them. I also intend to talk about some of the development trends we see in these areas. They entail challenges for the Riksbank, as for many other central banks, and need to be taken into account when reviewing the Sveriges Riksbank Act.