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  3. What is a Financial Sector Assessment Program (FSAP)?

What is a Financial Sector Assessment Program (FSAP)?

A Financial Sector Assessment Program (FSAP) is a comprehensive assessment of a country’s financial sector by the International Monetary Fund (IMF). The goal of FSAP assessments is to gauge the stability of the country’s financial sector, to identify any potential sources of systemic risk and to assess its potential contribution to growth and development.

The IMF will be undertaking a review of the New Zealand financial system in 2016 as part of their FSAP. The last FSAP for New Zealand was conducted nearly 13 years ago (in late 2003), with publication of findings and recommendations in May 2004.

An FSAP covers three broad areas:

  • an analysis of key financial system vulnerabilities and risks, together with an assessment of the resilience of the financial system
  • an assessment (using internationally defined standards) of the quality of the regulatory framework for banking supervision, insurance, securities regulation and financial markets infrastructure
  • an evaluation of financial safety nets, which reflect a jurisdiction’s capacity to manage and resolve a financial crisis.

FSAPs are mandatory for 29 ‘systemically important’ jurisdictions. New Zealand is not one of these 29 countries, so our FSAPs are voluntary.

You can find out more about FSAP assessments and view examples on the FSAP page of the IMF website.