Source: International Monetary Fund
Summary
The technical assistance mission supported the Central Bank of Curaçao and Sint Maarten in strengthening its capacity to assess banking sector resilience through the development of a new macro-stress testing framework. The framework integrates macro-consistent scenarios, sectoral credit risk models, and detailed projections of balance sheet and income statement items. Key recommendations include institutionalizing regular biannual stress testing exercises, refining parameter calibration, enhancing scenario development, and expanding data collection aligned with IFRS 9 standards. These efforts position the CBCS to improve its macroprudential oversight and better safeguard financial stability in the monetary union.
Subject: Bank soundness, Credit risk, Financial regulation and supervision, Financial sector policy and analysis, Financial sector stability, Stress testing
Keywords: Bank Resilience, Bank soundness, Credit risk, Credit Risk Models, Data collection, Financial sector stability, Financial Stability, Financial stability assessment, Macroeconomic Scenarios, Regulatory Framework, Stress testing, Stress Testing