The IMF's Stress Testing of the Norwegian Financial Sector
Abstract
Following a thorough examination of the Norwegian financial system, the IMF concluded in summer 2005 that the system is sound and well managed. Shorter-term vulnerabilities are low. This conclusion is based partly on the results of stress tests of the financial system that were performed by the IMF in cooperation with Norges Bank and Kredittilsynet (The Financial Supervisory Authority of Norway). In this article we provide a more detailed description of these stress tests. We also discuss stress tests and their use more generally.