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Chapter One
Introduction
1.1 The primary purpose of the Compilation Guide on Financial Soundness Indicators
(Guide) is to provide guidance on the concepts and definitions, and sources and techniques,
for the compilation and dissemination of the Financial Soundness Indicators (FSIs)
identified by the IMF’s Executive Board (see Table 1.1). The Guide is intended to encourage
compilation of FSIs and promote cross-country comparability of these data, as well as assist
compilers and users of FSI data, for the purpose of supporting national and international
surveillance of financial systems.
1.2 FSIs are indicators of the current financial health and soundness of the financial
institutions in a country, and of their corporate and household counterparts. They include
both aggregated individual institution data and indicators that are representative of the
markets in which the financial institutions operate. FSIs are calculated and disseminated for
the purpose of supporting macroprudential analysis. This is the assessment and surveillance
of the strengths and vulnerabilities of financial systems, with the objective of enhancing
financial stability and, in particular, limiting the likelihood of failure of the financial system.
1.3 FSIs are a new body of economic statistics that reflect an amalgam of influences. This
is evident from the conceptual framework described ahead. On the one hand, there are
concepts drawn from prudential and commercial measurement frameworks, which have been
developed to monitor individual entities. Other concepts are drawn from macroeconomic
measurement frameworks, which have been developed to monitor aggregate activity in the
economy. Given the flexibility provided by the Guide, these frameworks can be drawn upon
to develop the data set out in the Guide. Advice is also provided on reconciling the data
relevant for the Guide with these frameworks. However, some new data sources may need to
be developed. In this regard, the Guide serves as a be