News story | Date: 10/10/2019 | Ministry of Finance
The European Systemic Risk Board (ESRB) has issued a warning on medium-term residential real estate sector vulnerabilities in Norway. The ESRB said that these vulnerabilities may be a source of systemic risk to financial stability.
"The ESRB’s conclusions closely correspond with our own analyses of the residential real estate sector. The high debt burden of households and high housing prices constitute vulnerabilities in the Norwegian economy. The developments emphasise the importance of our efforts to contribute to a more sustainable growth in debt and to ensure that banks are well-capitalized," says Minister of Finance Siv Jensen.
The Minister of Finance has commented the ESRB warning and Norwegian measures to mitigate systemic risks in a response letter to the ESRB. The ESRB has sent similar warnings to four other countries, and recommendations to six other countries.