The Dutch Authority for the Financial Markets published the Financial Stability Committee’s readout of its 9 July 2025 meeting, warning that financial stability remains under pressure from persistent geopolitical tensions, structural economic vulnerabilities and international dependencies, including strong linkages with the United States. The committee also reviewed follow-up to International Monetary Fund Financial Sector Assessment Program recommendations, including steps to strengthen governance around mortgage lending standards. Moderate economic growth in the first half of 2025 is accompanied by a fragile external environment and uncertainty over global trade. Inflation is falling gradually toward 2% but remains above the euro area and sensitive to developments such as trade tariffs and energy price volatility. While financial markets have been resilient, elevated equity valuations were highlighted as a source of abrupt correction risk; Dutch financial institutions were assessed as having strong buffers, with robust risk management and scenario analysis emphasised, particularly for vulnerabilities not captured by historical data. Longer-term risks cited include weak productivity growth, labour market tightness, ageing and debt sustainability, alongside fiscal pressures from rising European defence spending. The committee noted that economic and financial ties with the US bring benefits but increase exposure to external shocks, pointing to the international dominance of the US dollar and potential spillovers from rising US public debt. It called for strategic diversification of trade relations and strengthening the European internal market, and referenced initiatives such as the European Payments Initiative and the Digital Operational Resilience Act as contributors to resilience and strategic autonomy. On mortgage lending standards, the committee welcomed a proposal to give the AFM and De Nederlandsche Bank a larger role in monitoring financial stability effects and underscored the need for both authorities to receive and use detailed mortgage data; the next committee meeting is scheduled for 12 November 2025, with digital and operational resilience set to be a specific focus.
Dutch Authority for the Financial Markets 2025-07-22
Dutch Authority for the Financial Markets publishes Financial Stability Committee warning on geopolitical tensions, US interdependence and digital dependence
The Dutch Authority for the Financial Markets released the Financial Stability Committee's 9 July 2025 meeting readout, highlighting financial stability pressures from geopolitical tensions and economic vulnerabilities. The committee reviewed IMF recommendations on mortgage lending governance and emphasized diversifying trade relations and strengthening the European internal market. It noted the benefits and risks of US economic ties, citing initiatives like the European Payments Initiative and the Digital Operational Resilience Act as key to resilience and strategic autonomy.