If households and firms were to substitute a large share of their deposits with the digital euro, or they were to use the digital euro as a safe heaven in time of stress, banks would need to replace a some of their stable funding and lose customer information that are essential to perform their activities.
However, the shock absorption capacity of the banking system is currently adequate. Regarding the question of whether or not house prices are overvalued, the analyses in the report give quite mixed results. Some measures suggest that there is a significant overvaluation while others do not provide evidence of overvaluation.