Financial Stability Board
The Financial Stability Board is a macroprudential body that comprises representatives from supervisory authorities, namely Banka Slovenije, the Insurance Supervision Agency and the Securities Market Agency, and the Ministry of Finance.
The FSB was established by the Macroprudential Supervision of the Financial System Act (the ZMbNFS; Official Gazette of the Republic of Slovenia, No. 100/13), under which it is responsible for formulating and implementing macroprudential policy in Slovenia with the objective of helping to protect the stability of the entire financial system by strengthening its resilience and reducing the build-up of systemic risks, thereby ensuring that the financial sector is able to make a lasting contribution to economic growth.
Tasks
To achieve that objective, the FSB is responsible for performing the following tasks:
formulating macroprudential policy,
identifying, monitoring and assessing risks to financial stability,
coordinating cooperation and the exchange of information between local supervisory authorities and the supervisory authorities of EU Member States,
issuing guidance to supervisory authorities regarding the prevention and mitigation of systemic risk,
proposing the use of supervisory measures and instruments to supervisory authorities,
coordinating the use of supervisory measures and instruments with the measures of authorities responsible for the financial stability of EU Member States and with the measures of other international financial institutions, and
implementing warnings and recommendations issued by the ESRB, and drawing up arguments for potential inaction or deviations from those warnings and recommendations.
Cooperation between supervisory authorities
The FSB contributes to the strengthening of cooperation between individual supervisory authorities, each of which supervises its own segment of the financial system, with the aim of working together to quickly and successfully identify risks that could spread from individual segments to the entire financial system.
The FSB formulates macroprudential policy by issuing guidance to supervisory authorities when the need to prevent or mitigate systemic risk to financial stability has been identified, or when it is assessed that the warnings and recommendations of the ESRB or other international financial institutions need to be implemented. The guidance is aimed at the supervisory authorities under whose remit the identified disruption falls. The guidance includes a definition of the identified systemic risk, and also proposes specific macroprudential supervisory measures when appropriate.
In implementing macroprudential policy the supervisory authorities are responsible for the macroprudential supervision of financial corporations, which are supervised according to the relevant sectoral laws. The supervisory authorities implement the FSB’s guidance within the framework of their powers and the relevant measures.
The ZMbNFS assigns the lead role within the FSB to Banka Slovenije by appointing the Governor of Banka Slovenije as president of the FSB, with the power to convene and chair sessions, while the working of the FSB’s secretariat also falls under Banka Slovenije’s remit.
The FSB reports on its work to the National Assembly once a year, and to EU authorities and the ESRB as necessary.