The conference “Debt and Financial Stability – Regulatory Challenges” being held by the Bundesbank and the Federal Ministry of Finance at the end of this month will therefore address this issue, too. One possible future approach could be for banks to back their claims on sovereign borrowers by capital commensurate with the risk and to subject them to large exposure limits. 7.
These improvements have largely resulted from massive support measures taken by governments and central banks. Likewise, we have recently seen further improvements in the outlook for the global economy. However, uncertainty is still high, as both fiscal stimuli and the inventory cycle, which are currently supporting growth in many countries, are transitory and as there remain risks to the financial sector.