Financial Stability Indicators – The Case of Croatia

Mirna Dumicic Jemric

Journal of Central Banking Theory and Practice, 2016, vol. 5, issue 1, 113-140

Abstract: This paper considers financial stability through the processes of accumulation and materialisation of systemic risks. To this end, the method of principal component analysis on the example of Croatia has been used to construct two composite indicators – a systemic risk accumulation index and an index reflecting the consequences of systemic risk materialisation. In the construction of the indices, the features and risks specific to small open economies were considered. Such an approach to systemic risk analysis facilitates the monitoring and understanding of the degree of financial stability and communication of macroprudential policy makers with the public.

Keywords: financial stability; systemic risks; financial system resilience; principal component analysis; Croatia (search for similar items in EconPapers)
JEL-codes: E44 E50 E58 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:cbk:journl:v:5:y:2016:i:1:p:113-140

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