The IMF Country Reports Series covers economic and financial developments and trends in member countries. Each report, prepared by a staff team after discussions with officials of the country, is published at the option of the member.
International Monetary Fund. Monetary and Capital Markets Department
INTERNATIONAL MONETARY FUND
This paper discusses the findings of the Financial System Stability Assessment for Sweden. The Swedish financial system is large and highly interconnected, putting a premium on the accompanying policy framework. Relative to the size of the domestic economy, the financial system is among Europe's largest. It features complex domestic and international linkages, reflecting Sweden's role as a regional financial hub. However, the macrofinancial risks have grown since 2011, for example the rising share of highly indebted households. Stress tests also suggest that banks and nonbanks are largely resilient to solvency shocks, but concerns persist about the ability of bank models to capture unexpected losses.