Vienna Initiative 2.0
The financial crisis has brought conflicts of interest between the banking sector’s home and host countries sharply into focus. Countries where foreign banks’ subsidiaries or branches are systemic face particular challenges in safeguarding financial stability and ensuring adequate credit supply for their economies. The countries of Central, Eastern and Southeastern Europe (CESEE) are important hosts to foreign banks headquartered predominantly in Western Europe. The ongoing eurozone crisis has highlighted the risk of disorderly deleveraging of western parent banks vis-à-vis their affiliates in CESEE and difficulties in cooperation between home and host country authorities.
Against this background, it is the objective of the Vienna Initiative 2 to help:
- Avoid disorderly deleveraging.
- Ensure that potential cross-border financial stability issues are resolved
- Achieve policy actions, notably in the supervisory area, that are taken in the best joint interest of home and host countries.
The Vienna Initiative 2 builds on the success of the Vienna Initiative 1, which was established at the height of the global financial crisis of 2008/09. It again uses a private-public sector platform, which brings together key International Financial Institutions, the European Commission and relevant EU institutions, the principal cross-border banking groups, and home and host country authorities, complementing other initiatives. Its geographical coverage extends beyond the European Union (EU) and also includes other CESEE counties with a substantial presence of western banks—instances where cross-border arrangements are naturally much less developed than inside the EU.
The work within the Vienna Initiative 2 aims for practical results by monitoring of, and reporting on, the deleveraging process and by setting up temporary structures where private and public sector decision makers meet to exchange experience and discuss appropriate actions.
Topics and instruments
Under the Vienna Initiative 2.0, the Steering Committee has identified the following streams as the focus of on-going work to continue to make the financial sectors in emerging Europe more resilient in the longer term:
- Supervisory Practices
- Bank Resolution Practices
- Observations on proposed BRRD and SRM
- Host authority coordination
A Host Country Cross-Border Forum for Croatia was held in Zagreb, 29 October 2012.
Opening Remarks, Host Country Cross-Border Stability Forum, 29 October 2012.
- Bank Lending Surveys
Presentations and Events
Ukraine Financial Forum, Brussels, 14 November 2014
Opening Address by EU Commissioner Johannes Hahn
Vienna Initiative Full Forum Meeting, Brussels, 13 November 2014
Priorities for the Vienna Initiative in 2015 by Governor Marek Belka, Chairman of the Vienna Initiative Steering Committee
Vienna Initiative Full Forum Meeting, Brussels, 9 November 2012
Keynote Speech by Marek Belka, Chairman of the Vienna Initiative Steering Committee
Meeting of Vienna Initiative, Vienna, 16 January 2012
From Vienna 1.0 to Vienna 2.0
Deleveraging Outlook and Structural Change in Banking Systems
- Macroeconomic Outlook for Central, Eastern and Southeastern Europe (IMF)
- CESEE Deleveraging and Credit Monitor (IMF)
- VI Bank Lending Survey in CESEE (EIB)
- Single Supervisory Mechanism (ECB)
- Working group on credit guarantee schemes: Summary and conclusions of the WG report (EIB, World Bank, NBP)
- NPL Resolution: A Region-Wide NPL Project (EBRD)
- Third Report on the Joint IFI Action Plan for Growth in CESEE (EIB)
- Non-Performing Loands in CESEE (IMF)
- Dealing with impaired assets – lessons from the euro zone periphery – the Spanish experience (European Commission)
- Debt Restructuring and NPL Resolution: The private banks’ restructuring initiative (Erste, RBI, UniCredit)
- Restructuring Principles Selective case study: Mercator (Clifford Chance)
- A more coordinated approach to restructuring for SEE? (Schoenherr)
Vienna 2 Full Forum Focuses on Deleveraging and Bank Resolution (12 November 2012)
Special Meeting of the European Bank Coordination “Vienna” Initiative (16 January 2012)
Press releases and related press coverage
Public-private forum boosts coordination to support financial sector stability in emerging Europe