Assessing risks to financial stability The better we understand the sources and the transmission of financial system stress, the better we will be able to prevent, or at least limit, the impact of financial crises. To that end, our new framework informs and directs our risk-assessment process. 4 At the heart of the framework is the explicit identification of vulnerabilities and risks.
Such transparency encourages everyone involved in the financial system to consider how to mitigate the vulnerabilities and react if the risks were to materialize.