Risk dashboard - ESMA - December 2015

The European Securities and Markets Authority (ESMA) published in December 2015 a risk dashboard for the third quarter of 2015.

According to ESMA’s analysis, systemic stress has increased during the reported period due to market uncertainty about the sovereign debt in the European Union and due to concerns related to the market development in emerging economies.

Thus, risk level remained increased one, both in terms of risk affecting investors, infrastructure and services and the financial system as a whole and operational risk while credit risk and contagion risk remained at a very high level. Both categories of risk and their level and evolution are presented in the risk dashboard published by ESMA.

The main risk sources remain weak economic outlook emphasized by the concerns about emerging economies, very low interest rates, fiscal crisis in the euro zone, funding models and potential weaknesses in the functioning of the market. ESMA analysis highlights the causes and evolution of the risk sources listed above.

Amid the stress on the public debt of a certain European country and tensions relating to the shares of emerging economies, the contribution made by shares to systemic stress indicator was the most important, followed by bonds.

The complete document can be accessed here.