Summary
The near-term risks to the stability of the global financial system are low and somewhat lower than in May 2005. Global economic growth remains strong. Developments in variables that influence financial stability in the near term have also been satisfactory in Norway. Banks achieved solid results in the first three quarters of 2005, primarily as a result of very low loan losses and lower costs. In the near term, households' financial position is favorable because interest rates are low and household income is rising. With a high equity ratio and continued solid profitability in the corporate sector, the credit risk associated with loans to the corporate market is assessed as relatively low, and somewhat lower than in May. On balance, the short-term outlook for financial stability is therefore regarded as satisfactory and somewhat better than half a year ago. The sharp rise in house prices and debt, however, entail a risk of less stable economic developments in the longer term.
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Summary
Favourable outlook for global financial stability in the near term
The near-term risks to the stability of the global financial system are low and somewhat lower than in May 2005 when the previous Financial Stability report was published. Global economic growth remains strong. Both enterprises an...See the full content of this document
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