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Austria: Finanzmarktstabilitatsgesetz (FinStaG)

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Abstract

Following the adoption of a joint framework by euro area countries in response to the intensifying financial crisis in October 2008, Austria enacted a package of measures including the Financial Market Stability Act (Finanzmarktstabilitatsgesetz, or FinStaG). In addition to permitting nationalization under certain circumstances, FinStaG allowed the Austrian government to use six specific measures to recapitalize credit institutions operating in Austria and Austrian insurance companies. According to FinStaG, EUR15 billion ($22 billion) could be used for this purpose, though this amount was later increased. Eight institutions received support through FinStaG, and the government granted capital and liquidity support totaling EUR21 billion. It appears that recapitalization measures can still be instituted under FinStaG, but the blanket approval by the European Commission expired on June 30, 2011, at which point any measures would have to be considered on a case-by-case basis.

Suggested Citation

  • Simon, Claire, 2021. "Austria: Finanzmarktstabilitatsgesetz (FinStaG)," Journal of Financial Crises, Yale Program on Financial Stability (YPFS), vol. 3(3), pages 1-15, April.
    • Handle: RePEc:ysm:ypfsfc:3311
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    References listed on IDEAS

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    1. Petrovic, Ana & Tutsch, Ralf, 2009. "National rescue measures in response to the current financial crisis," Legal Working Paper Series 8, European Central Bank.
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    More about this item

    Keywords

    FinStaG; Global Financial Crisis; recapitalization;
    All these keywords.

    JEL classification:

    • G01 - Financial Economics - - General - - - Financial Crises
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

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