Swedish banks ‘well-equipped’ to weather financial crisis

Following the week’s turbulence in the financial markets, Sweden’s Swedish Financial Supervisory Authority (FI) and the Riksbank met with members of the Riksdag’s finance committee to discuss the crisis.

“Our Swedish banks are well-equipped,” said FI’s deputy head Erik Saers.

“This development has two sides, in part we’re seeing falling asset values, but we’re also seeing that interest rates between banks have risen and the cost is passed along to the consumers. Our banks have managed well so far but now a second wave of financial problems is coming, but our assessment is that [the banks] are still well prepared.”

According to First Deputy Governor Irma Rosenberg, the Riksbank is following developments closely.

“We have good information on it and we are prepared to do what is needed if it is needed,” she said after with the Riksdag’s finance committee.

According to her, the Swedish financial system is still in satisfactory condition.

“The daily lending market, that is to say, banks lending to one another, has been working and the banks have been able to finance themselves on the Swedish market and internationally,” said Rosenberg.

The world’s large central banks are today working together to pump money into the financial system in order to improve liquidity in the money markets.

According to Reuters, the European Central Bank, Bank of Japan, Swiss National Bank, and the US Federal Reserve are involved.