We supervise the financial marketsAt the moment, Friday, 7 December, the TRS 2 system is unable to create FD files (daily feedback).
Reference rates are important since they are used in many financial contracts, and it is therefore crucial that they are fair, transparent and accurately reflect the underlying market.
Low interest rates have contributed to high risk-taking, rising asset prices and increasing debt. Higher interest rates in the next few years could reduce risk-taking and thus dampen the build-up of risk. However, unexpectedly large interest rate fluctuations and uncertain global developments could also test the financial sector’s resilience. These are some of the conclusions Finansinspektionen (FI) draws in this year’s second report on the stability in the financial system. The report will be presented at a press conference today.
The economy continues to be strong, both in Sweden and globally, but it is now showing signs of a slow-down. Interest rates have been low for a long period of time, which has led to high risk-taking and rising asset prices. As a result, the risks in the financial system are elevated. The resilience in the Swedish financial system is satisfactory in general but continued high growth in debt fuelled by lending and investments related to residential property and commercial real estate require monitoring.
On Monday, 26 November, TRS 2 was upgraded to a new system version.
Despite the positive progression over the past few weeks, there is still some uncertainty surrounding Brexit. FI has previously identified the limited access to clearing services as one of the consequences of Brexit that could have a major impact on Swedish firms. The European Commission’s communication that it will take action to manage risks to financial stability that are associated with clearing is therefore welcomed. At the same time, though, a hard Brexit could create other types of frictions that affect Swedish firms. It is therefore of utmost importance that Swedish firms continue to prepare for Brexit.
FI is extending the ongoing maintenance and upgrade of the production environment in the TRS2 system until further notice.
Financial reporting supervision (enforcement of financial information) should be carried out in a manner that fulfils the requirements set out in the Securities Market Act (2007:528) and Finansinspektionen’s regulations (FFFS 2007:17) and the guidelines set out in ESMA’s guidelines on enforcement of financial information (ESMA/2014/1293).
