[{"data":1,"prerenderedAt":-1},["ShallowReactive",2],{"detail-sidebar-cat-0-en-105":3,"doc-seo-500378-105":59,"doc-detail-500378-en":131},{"code":4,"msg":5,"data":6},0,"success",[7,13,18,23,28,33,38,43,48,51,55],{"id":8,"doc_module":4,"doc_module_name":9,"category_name":10,"show_sort_weight":11,"slug":12},1,"Document","Story & Novel",90,"story-novel",{"id":14,"doc_module":4,"doc_module_name":9,"category_name":15,"show_sort_weight":16,"slug":17},2,"Literature",80,"literature",{"id":19,"doc_module":4,"doc_module_name":9,"category_name":20,"show_sort_weight":21,"slug":22},4,"Exam",70,"exam",{"id":24,"doc_module":4,"doc_module_name":9,"category_name":25,"show_sort_weight":26,"slug":27},5,"Comic",60,"comic",{"id":29,"doc_module":4,"doc_module_name":9,"category_name":30,"show_sort_weight":31,"slug":32},6,"Technology",50,"technology",{"id":34,"doc_module":4,"doc_module_name":9,"category_name":35,"show_sort_weight":36,"slug":37},7,"Healthcare",40,"healthcare",{"id":39,"doc_module":4,"doc_module_name":9,"category_name":40,"show_sort_weight":41,"slug":42},8,"Research & Report",30,"research-report",{"id":44,"doc_module":4,"doc_module_name":9,"category_name":45,"show_sort_weight":46,"slug":47},9,"Religion & Spirituality",20,"religion-spirituality",{"id":46,"doc_module":4,"doc_module_name":9,"category_name":49,"show_sort_weight":46,"slug":50},"World Cup","world-cup",{"id":52,"doc_module":4,"doc_module_name":9,"category_name":53,"show_sort_weight":52,"slug":54},10,"Lifestyle","lifestyle",{"id":56,"doc_module":4,"doc_module_name":9,"category_name":57,"show_sort_weight":24,"slug":58},19,"General","general",{"code":4,"msg":60,"data":61},"ok",{"site_id":62,"language":63,"slug":64,"title":65,"keywords":66,"description":67,"schema_data":68,"social_meta":124,"head_meta":126,"extra_data":128,"updated_unix":130},105,"en","financial-stability-review-may-2026","Financial Stability Review - May 2026","","Financial Stability Review (May 2026) assesses euro area financial stability under escalating geopolitical risk, including war-related energy and commodity supply disruptions and rising cybersecurity and hybrid threats. It reviews pervasive yet orderly market adjustments, identifies vulnerabilities from stretched asset valuations, and highlights risks from cross-asset repricing and non-bank funding or redemption dynamics. The report evaluates banks’ profitability, funding, liquidity, and asset quality while outlining macroprudential priorities. It also examines risks and supervisory needs across non-bank financial sectors and private credit spillovers.",{"@graph":69,"@context":123},[70,84,106],{"@type":71,"itemListElement":72},"BreadcrumbList",[73,77,79,82],{"item":74,"name":75,"@type":76,"position":8},"https://docshare.wps.com","Home","ListItem",{"item":78,"name":9,"@type":76,"position":14},"https://docshare.wps.com/document/",{"item":80,"name":40,"@type":76,"position":81},"https://docshare.wps.com/document/research-report/",3,{"item":83,"name":65,"@type":76,"position":19},"https://docshare.wps.com/document/financial-stability-review-may-2026/500378/",{"url":83,"name":65,"@type":85,"image":86,"author":91,"headline":65,"publisher":94,"fileFormat":97,"inLanguage":63,"description":67,"dateModified":98,"datePublished":99,"encodingFormat":97,"isAccessibleForFree":100,"interactionStatistic":101},"DigitalDocument",{"url":87,"@type":88,"width":89,"height":90},"https://docshare.wps.com/thumbnails/financial-stability-review-may-2026/500378.png","ImageObject",300,407,{"name":92,"@type":93},"404brain","Person",{"url":74,"name":95,"@type":96},"DocShare","Organization","application/pdf","2026-10-22","2026-10-03",true,{"@type":102,"interactionType":103,"userInteractionCount":105},"InteractionCounter",{"@type":104},"ViewAction",11,{"@type":107,"mainEntity":108},"FAQPage",[109,115,119],{"name":110,"@type":111,"acceptedAnswer":112},"What main geopolitical developments are highlighted for financial stability in this edition?","Question",{"text":113,"@type":114},"The report focuses on the war in the Middle East and its impacts on global energy and commodity supplies, growth prospects, and inflation. It also notes rising cybersecurity risks and hybrid threats to critical infrastructure in a complex geopolitical environment.","Answer",{"name":116,"@type":111,"acceptedAnswer":117},"How does the report characterize financial market adjustments so far?",{"text":118,"@type":114},"Adjustments are described as pervasive but orderly, with financial asset prices still stretched by historical standards. This combination is said to leave markets vulnerable to sharp repricing.",{"name":120,"@type":111,"acceptedAnswer":121},"What additional risks does the report identify for non-bank financial institutions?",{"text":122,"@type":114},"It warns that unforeseen redemptions during drawdowns and margin calls amid surging volatility could challenge non-banks, especially open-ended corporate bond funds with low liquidity buffers. It also calls for close monitoring of private markets due to possible spillovers from US markets.","https://schema.org",{"og:url":83,"og:type":125,"og:title":65,"og:site_name":95,"og:description":67},"article",{"robots":127,"canonical":83},"index,follow",{"doc_id":129,"site_id":62},500378,1791240748,{"code":4,"msg":5,"data":132},{"doc_id":129,"user_id":133,"nickname":92,"user_avatar":134,"doc_module":4,"category_id":39,"category_name":40,"doc_title":65,"doc_description":67,"doc_content":135,"file_id":136,"file_url":137,"file_type":138,"file_size":139,"view_count":105,"is_deleted":4,"is_public":8,"is_downloadable":8,"audit_status":8,"page_count":140,"language":141,"language_code":63,"site_id":62,"html_lang":63,"table_of_contents":142,"faqs":143,"seo_title":144,"seo_description":67,"update_tm":145,"read_time":146},1099529839291,"https://ap-avatar.wpscdn.com/davatar_6f874abed73319feea01a86fa6f0fab8","Financial Stability Review  \nMay 2026  \nContents  \nForeword 3  \nOverview 4  \n1 Macro-financial and credit environment 14  \n1.1 Trade fragmentation and energy supply disruptions are clouding  \nthe outlook for the euro area 14  \nBox 1 Financial stability implications of geopolitical and geoeconomic risks 18  \n1.2 Public finances under pressure in a challenging geopolitical environment 20  \n1.3 Renewed energy shock and tighter credit are testing corporate  \nresilience 23  \n1.4 Labour market shelters household resilience, for now 26  \n1.5 Dynamics in property markets differ markedly across countries  \nand segments 28  \n2 Financial markets 32  \n2.1 Markets adjust to geopolitical conflict and energy shock 32  \n2.2 Bond markets start to be challenged by renewed  \nmacroeconomic uncertainties 37  \nBox 2 Along the curve: investor reallocation in euro area government bonds 40  \n2.3 Concentrated exposures could increase the risk of abrupt cross  \nasset repricing 43  \n3 Euro area banking sector 47  \n3.1 Aggregate bank profitability remains strong in a changing  \noperating environment 47  \nBox 3 The drivers of the 2025 surge in euro area banks’ market  \nvaluations 51  \n3.2 Bank funding conditions stay benign, but could tighten 54  \n3.3 Asset quality continues to be high amid pockets of vulnerability 57  \n3.4 Liquidity ratios and capital buffers have remained stable 60  \n3.5 Geopolitical risks underscore the need for bank resilience to be  \na macroprudential priority 62  \n4 Non-bank financial sector 66  \n4.1 The non-bank financial sector weathers geopolitical risks 66  \nBox 4 Drivers of investor behaviour in highly valued equity markets 69  \n4.2 Investment fund flows remain sensitive, with private credit  \nadding further risk 72  \n4.3 Resilient insurance and pension fund sectors face volatile  \nmarkets 76  \n4.4 Enhanced NBFI macroprudential and supervisory frameworks  \nare key to developing EU capital markets 79  \nBox 5 Assessing the macroprudential impact of liquidity management tools for investment funds: a system-wide analysis 82  \nSpecial features 87  \n From dictionaries to AI: a new era in sentiment analysis for  \nfinancial stability 87  \n Rising bankruptcies, resilient loan books: unpacking euro area  \ncorporate credit risk 102  \n House price booms and policy choices: insights from a meta  \nregression analysis 115  \n Stress in global private credit markets and its implications for euro area financial stability 132  \nForeword  \nAt the turn of the year 2025-26, economic growth surprised on the upside while financial market sentiment remained strong despite high uncertainty. The war in the Middle East is now putting this resilience to the test. The conflict has disrupted the global supply of energy and other commodities, dented growth prospects, pushed energy prices up and, by extension, raised inflation. While the full impact of the war is unclear at this stage, the repercussions for the global economy and financial stability are becoming graver the longer it lasts. Also, cybersecurity risks and hybrid threats to critical infrastructure are rising in this complex geopolitical environment.  \nFinancial market adjustments have been pervasive but, nevertheless, orderly so far. Despite initial declines, financial asset prices still look stretched by historical standards, all the more so when current geoeconomic stress and uncertainty are taken into account. This leaves markets vulnerable to sharp repricing, and non-bank financial institutions could amplify financial market swings if they were to occur. Unforeseen redemptions during drawdowns and margin calls in the context ofsurging volatility could challenge non-banks in general and open-ended corporate bond funds in particular, given their low liquidity buffers. While not a systemic concern for the euro area, private markets warrant close monitoring in light of the potential for a spillover of stresses from US markets.  \nOn the positive side, euro area banks have benefited from a decade-lon","cbCaitXiddfenqWA","https://ap.wps.com/l/cbCaitXiddfenqWA","pdf",4740875,143,"English","# Foreword\n# Overview\n# 1 Macro-financial and credit environment\n## 1.1 Trade fragmentation and energy supply disruptions are clouding the outlook for the euro area\n## 1.2 Public finances under pressure in a challenging geopolitical environment\n## 1.3 Renewed energy shock and tighter credit are testing corporate resilience\n## 1.4 Labour market shelters household resilience, for now\n## 1.5 Dynamics in property markets differ markedly across countries and segments\n# 2 Financial markets\n## 2.1 Markets adjust to geopolitical conflict and energy shock\n## 2.2 Bond markets start to be challenged by renewed macroeconomic uncertainties\n## 2.3 Concentrated exposures could increase the risk of abrupt cross asset repricing\n# 3 Euro area banking sector\n## 3.1 Aggregate bank profitability remains strong in a changing operating environment\n## 3.2 Bank funding conditions stay benign, but could tighten\n## 3.3 Asset quality continues to be high amid pockets of vulnerability\n## 3.4 Liquidity ratios and capital buffers have remained stable\n## 3.5 Geopolitical risks underscore the need for bank resilience to be a macroprudential priority\n# 4 Non-bank financial sector\n## 4.1 The non-bank financial sector weathers geopolitical risks\n## 4.2 Investment fund flows remain sensitive, with private credit adding further risk\n## 4.3 Resilient insurance and pension fund sectors face volatile markets\n## 4.4 Enhanced NBFI macroprudential and supervisory frameworks are key to developing EU capital markets\n# Special features","[{\"question\":\"What main geopolitical developments are highlighted for financial stability in this edition?\",\"answer\":\"The report focuses on the war in the Middle East and its impacts on global energy and commodity supplies, growth prospects, and inflation. It also notes rising cybersecurity risks and hybrid threats to critical infrastructure in a complex geopolitical environment.\"},{\"question\":\"How does the report characterize financial market adjustments so far?\",\"answer\":\"Adjustments are described as pervasive but orderly, with financial asset prices still stretched by historical standards. This combination is said to leave markets vulnerable to sharp repricing.\"},{\"question\":\"What additional risks does the report identify for non-bank financial institutions?\",\"answer\":\"It warns that unforeseen redemptions during drawdowns and margin calls amid surging volatility could challenge non-banks, especially open-ended corporate bond funds with low liquidity buffers. It also calls for close monitoring of private markets due to possible spillovers from US markets.\"}]","Financial Stability Review - May 2026 | PDF",1791010975,360]