News 22 March 2018
The new way of handling banks and other institutions in crisis has changed the conditions for tackling financial crisis. We will no longer save institutions with tax funds, said Director General Hans Lindblad at the Nordic Bank Capital and Funding Forum conference in Stockholm.
In December, the Swedish National Debt Office decided on resolution plans for all concerned institutions. Plans are now in place for how each institution should be handled in a financial crisis. For systemically important institutions The Debt Office can save the function of the institution, but not its shareholders or other investors.
– It is no exaggeration to say that it is a paradigm shift, says Director General Hans Lindblad.
The Debt Office has taken a position on how each bank is to be managed in a crisis and decided on the minimum requirement for own funds and eligible liabilities.
"We have already seen that the requirements have resulted in positive effects. But both the Debt Office and the institutions have a lot of work still to do, says Hans Lindblad.
The Debt Office will continue the work of developing the analyzes and methods required to execute resolution. But the institutions also need to adjust, including by changing their funding to meet the minimum requirements for own funds and eligible liabilities.
Hans Lindblad speach, Resolution – a paradigm shift
Hans Lindblad presentation