The stability of the financial system is a precondition for financial institutions to conduct business in support of sustainable economic growth. Financial stability can be promoted by ensuring adequate risk resilience in individual financial institutions and within the financial system as a whole and, if necessary, by implementing preventive measures for the mitigation of risks posing a threat to financial stability. Macroprudential supervision supports microprudential supervision, i.e. monitoring of risks to individual financial institutions, in an effort to foster stability.
In Finland, the authority responsible for macroprudential supervision is the Financial Supervisory Authority (FIN-FSA), whose Board makes decisions on the application of macroprudential instruments. The macroprudential analysis in support of the decisions is conducted in close cooperation between the Bank of Finland, the FIN-FSA and the Ministry of Finance.
In addition, the European Central Bank (ECB) is mandated to carry out specifically defined macroprudential tasks within the framework of the Single Supervisory Mechanism (SSM). At Union level, the European Systemic Risk Board (ESRB) issues recommendations of its own for organising macroprudential policy within the European Union.