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Stress-Testing Croatian Households with Debt : Implications for Financial Stability

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dc.contributor.authorZalduendo, Juan
dc.contributor.authorSugawara, Naotaka
dc.date.accessioned2012-03-19T18:06:39Z
dc.date.available2012-03-19T18:06:39Z
dc.date.issued2011-12-01
dc.description.abstractThe purpose of this paper is to stress test the resilience of Croatian households with debt to economic shocks. The shocks not only impact a household's welfare, but also increase the probability of loan default. As a result, there is a direct link between these stress-testing exercises and financial stability risks. The authors find that very few households are at risk as a result of the shocks experienced over the past few years; new vulnerable households represent about 2 percent of all households, 6 percent of households with debt, and 2-3 percent of aggregate banking system assets. This suggests that household over-indebtedness in Croatia is unlikely to become a drag on aggregate economic activity and that financial stability risks remain manageable. One caveat should be noted. Some 27-31 percent of households with debt, representing 8-9 of banking system assets, are vulnerable even before being subjected to an economic shock. Since NPLs were low before the global financial crisis, it can be argued that banks knew something about some of these households that is not captured by household budget surveys. It follows that the calculations in this paper should primarily focus on the increased vulnerability of households as a result of shocks and are likely to represent an upper bound to the financial stability risks faced by Croatia on account of household indebtedness.en
dc.identifierhttp://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20111212114319
dc.identifier.doi10.1596/1813-9450-5906
dc.identifier.urihttps://hdl.handle.net/10986/3675
dc.languageEnglish
dc.relation.ispartofseriesPolicy Research working paper ; no. WPS 5906
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo/
dc.subjectADVANCED ECONOMIES
dc.subjectARREARS
dc.subjectASSET CLASSES
dc.subjectBALANCE SHEETS
dc.subjectBANK OF ENGLAND
dc.subjectBANKING ASSETS
dc.subjectBANKING CRISES
dc.subjectBANKING SECTOR
dc.subjectBANKING SECTOR DEVELOPMENTS
dc.subjectBANKING SYSTEM
dc.subjectBANKING SYSTEM ASSETS
dc.subjectBORROWER
dc.subjectCENTRAL BANK
dc.subjectCHECKS
dc.subjectCONSUMER DURABLES
dc.subjectCONSUMER LOANS
dc.subjectCONSUMER PROTECTION
dc.subjectCONSUMPTION EXPENDITURE
dc.subjectCONSUMPTION EXPENDITURES
dc.subjectCONTRACTUAL OBLIGATIONS
dc.subjectCORPORATE DEBT
dc.subjectCOURT NEGOTIATIONS
dc.subjectCREDIT GROWTH
dc.subjectCREDITOR
dc.subjectCREDITORS
dc.subjectCREDITWORTHINESS
dc.subjectCROATIAN NATIONAL BANK
dc.subjectCURRENCY COMPOSITION
dc.subjectCURRENCY DISTRIBUTION
dc.subjectDEBT
dc.subjectDEBT HOLDINGS
dc.subjectDEBT INSTRUMENT
dc.subjectDEBT LEVELS
dc.subjectDEBT OBLIGATIONS
dc.subjectDEBT OVERHANG
dc.subjectDEBT PROBLEMS
dc.subjectDEBT RELIEF
dc.subjectDEBT RESTRUCTURING
dc.subjectDEBT SERVICE
dc.subjectDEBT SERVICE BURDEN
dc.subjectDEBT SERVICE OBLIGATIONS
dc.subjectDEBT SERVICE PAYMENTS
dc.subjectDEBT STOCK
dc.subjectDEBTOR
dc.subjectDEBTORS
dc.subjectDEBTS
dc.subjectDEFAULT RISKS
dc.subjectDEPRECIATION
dc.subjectDEVALUATION
dc.subjectDISPOSABLE INCOME
dc.subjectDISTORTIONS
dc.subjectDOMESTIC CURRENCY
dc.subjectDURABLE
dc.subjectDURABLE GOODS
dc.subjectECONOMIC CONDITIONS
dc.subjectECONOMIC MODEL
dc.subjectECONOMIC SHOCK
dc.subjectECONOMIC SHOCKS
dc.subjectEQUILIBRIUM
dc.subjectESTATE
dc.subjectEURO EXCHANGE RATE
dc.subjectEXCHANGE RATE
dc.subjectEXCHANGE RATE REGIME
dc.subjectEXCHANGE RATE SHOCK
dc.subjectEXCHANGE RATES
dc.subjectEXISTING DEBTS
dc.subjectEXPENDITURE
dc.subjectEXPENDITURES
dc.subjectEXPOSURE
dc.subjectFINANCIAL ASSETS
dc.subjectFINANCIAL CRISIS
dc.subjectFINANCIAL DISTRESS
dc.subjectFINANCIAL STABILITY
dc.subjectFINANCIAL SUPPORT
dc.subjectFIXED INTEREST
dc.subjectFIXED INTEREST RATE
dc.subjectFLEXIBLE INTEREST RATES
dc.subjectFORECLOSURE
dc.subjectFORECLOSURE PROCEDURES
dc.subjectFOREIGN CURRENCY
dc.subjectFOREIGN CURRENCY LOANS
dc.subjectGENERAL EQUILIBRIUM
dc.subjectGOVERNMENT GUARANTEES
dc.subjectHIGH DEBT
dc.subjectHOUSEHOLD DEBT
dc.subjectHOUSEHOLD DEBTS
dc.subjectHOUSEHOLD INCOME
dc.subjectHOUSING
dc.subjectHOUSING LOANS
dc.subjectHOUSING PRICES
dc.subjectIMPACT OF DEBT
dc.subjectINCOME LEVELS
dc.subjectINCOME SHOCKS
dc.subjectINCOMES
dc.subjectINCREASE IN DEBT
dc.subjectINDEBTED
dc.subjectINDEBTED HOUSEHOLDS
dc.subjectINDEBTEDNESS
dc.subjectINDICATOR VARIABLE
dc.subjectINDIVIDUAL BANKS
dc.subjectINSTITUTIONAL ARRANGEMENTS
dc.subjectINSTITUTIONAL FRAMEWORKS
dc.subjectINTEREST DIFFERENTIALS
dc.subjectINTEREST PAYMENTS
dc.subjectINTEREST RATE ADJUSTMENTS
dc.subjectINTEREST RATE DIFFERENTIALS
dc.subjectINTEREST RATE SHOCK
dc.subjectINTEREST RATES
dc.subjectINTERNATIONAL BANK
dc.subjectINTERNATIONAL STANDARD
dc.subjectJUDGE
dc.subjectLABOR FORCE
dc.subjectLABOR MARKET
dc.subjectLEVEL OF DEBT
dc.subjectLEVEL OF RISK
dc.subjectLEVELS OF DEBT
dc.subjectLIVING STANDARD
dc.subjectLIVING STANDARDS
dc.subjectLOAN
dc.subjectLOAN AMOUNTS
dc.subjectLOAN DEFAULT
dc.subjectLOAN ORIGINATION
dc.subjectLOAN PORTFOLIO
dc.subjectLOCAL CURRENCY
dc.subjectLOCAL CURRENCY LOAN
dc.subjectLOCAL CURRENCY LOANS
dc.subjectLONG-TERM LOCAL CURRENCY
dc.subjectMACROECONOMIC DATA
dc.subjectMICRO DATA
dc.subjectMONETARY FUND
dc.subjectMONIES
dc.subjectMORAL HAZARD
dc.subjectMORTGAGE
dc.subjectMORTGAGE DEBT
dc.subjectMORTGAGES
dc.subjectNATIONAL BANK OF HUNGARY
dc.subjectNOMINAL DEVALUATION
dc.subjectNON-PERFORMING LOANS
dc.subjectNPL
dc.subjectPENSIONS
dc.subjectPERSONAL COMPUTER
dc.subjectPOSSESSION
dc.subjectPRIVATE DEBT
dc.subjectPRIVATE RESTRUCTURING
dc.subjectPROBABILITY OF DEFAULT
dc.subjectPROBLEM LOANS
dc.subjectREAL ESTATE
dc.subjectRECESSION
dc.subjectREGIME CHOICE
dc.subjectREGULATORY AUTHORITIES
dc.subjectREGULATORY FORBEARANCE
dc.subjectREGULATORY TREATMENT
dc.subjectSAVINGS
dc.subjectSHORT-TERM INTEREST RATES
dc.subjectSTANDARD DEVIATIONS
dc.subjectSTOCKS
dc.subjectSVERIGES RIKSBANK
dc.subjectSYSTEMIC BANKING CRISES
dc.subjectTAX
dc.subjectTOTAL DEBT
dc.subjectTRANSITION COUNTRIES
dc.subjectTYPE OF DEBT
dc.subjectUNEMPLOYMENT RATE
dc.subjectUNEMPLOYMENT RATES
dc.subjectVARIABLE INTEREST RATE
dc.subjectVARIABLE INTEREST RATES
dc.subjectWEIGHTS
dc.titleStress-Testing Croatian Households with Debt : Implications for Financial Stabilityen
dspace.entity.typePublication
okr.crossref.titleStress-Testing Croatian Households with Debt-Implications for Financial Stability
okr.date.doiregistration2025-04-10T11:06:35.453212Z
okr.doctypePublications & Research::Policy Research Working Paper
okr.docurlhttp://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20111212114319
okr.guid926021468032936689
okr.identifier.doi10.1596/1813-9450-5906
okr.identifier.externaldocumentum000158349_20111212114319
okr.identifier.internaldocumentum15544835
okr.identifier.reportWPS5906
okr.language.supporteden
okr.pdfurlhttp://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2011/12/12/000158349_20111212114319/Rendered/PDF/WPS5906.pdfen
okr.region.administrativeEurope and Central Asia
okr.region.administrativeEurope and Central Asia
okr.region.countryCroatia
okr.region.geographicalEurope
okr.region.geographicalEastern Europe
okr.unitDevelopment Research Group (DECRG)
okr.volume1 of 1
relation.isAuthorOfPublication15ad6511-d287-58b3-a826-22cbb2bd8097
relation.isAuthorOfPublication.latestForDiscovery15ad6511-d287-58b3-a826-22cbb2bd8097
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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