A Collaborative Virtual Course with Banque de France on Financial Stability Policy of Central Banks

From May 31 to June 4, 2021, the Banque de France (BdF) and the JVI delivered a joint virtual course on Financial Stability Policy of Central Banks. This collaborative course between the JVI and the BdF’s International Banking and Finance Institute was first delivered in 2014 and has been part of our curriculum ever since. The course is typically delivered twice a year: once in Spring and hosted at the JVI and then later in Fall hosted at the BdF.

This year, the course brought together 18 participants from twelve different countries, from the JVI region and beyond. Many of them were no strangers to JVI training and had participated in our face-to-face and virtual courses before. The participants’ breadth of knowledge and wealth of expertise and experience strongly contributed to the successful delivery of the course.

The program was rich, covering essential aspects of the financial stability function of central banks. The course started out with an overview of the French experience on the setup and use of macroprudential policy measures. The participants also had a chance to dig deeper into the use and calibration of Basel III countercyclical capital buffers, including during a hands-on workshop. A session on early warning indicators aimed at familiarizing participants with the process of setting up a system that would signal the build-up of cyclical systemic risk and could inform policymaking. A further session on macroprudential stress testing provided an overview of modeling methodologies and guidelines based on the BdF experience of designing a macroprudential analytical toolbox for policymaking.

The remaining lectures of the course discussed recent trends in, and issues related to, financial stability, including nonperforming loan management and resolution, real estate market analysis and understanding the role of capital flows and their management. The course also included an introductory session on the financial stability implications of climate change, the risks that it creates for the economy at large as well the importance of taking early actions.

The next delivery of the course will be hosted by BdF and will take place on November 15-19, 2021.

Maria Arakelyan, Economist, Joint Vienna Institute
Hedi Jeddi, Banque de France