Definitions and objectives

Macroprudential policy refers to a set of policy options aimed at limiting the build-up of vulnerabilities in the financial system and strengthening financial system resilience, thereby protecting and promoting financial stability. Macroprudential policy can be directed at reducing vulnerabilities across three dimensions:

a.     Time dimension: Prevent or contain the gradual build-up of systemic vulnerabilities.

b.     Cross-sectoral dimension: Increase the overall resilience of the financial system to shocks and limit contagion effects.

c.     Structural dimension: Mitigate, to the extent possible, structural vulnerabilities within the financial system and encourage a
        system-wide perspective of financial regulation.

In April 2024, the SARB’s Financial Stability Committee (FSC) endorsed the updated SARB macroprudential policy framework and decision-making process and the SARB financial stability monitoring and assessment framework. Its publication aims to increase transparency on how the SARB pursues its financial stability mandate in line with international best practice.

In South Africa, macroprudential policy aims to protect and enhance financial stability as defined in the Financial Sector Regulation Act 9 of 2017 (FSR Act).




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