RAMSI: a top-down stress-testing model

Our Financial Stability Papers are designed to develop new insights into risk management, to promote risk reduction policies, to improve financial crisis management planning or to report on aspects of our systemic financial stability work.
Published on 11 September 2012

Financial Stability Paper No. 17
By Oliver Burrows, David Learmonth and Jack McKeown

Top-down stress testing is one way of assessing the resilience of the financial system to the risks it might face now, or in the future. And by considering a range of different risks, top-down stress testing can also provide an indication of the key vulnerabilities of the system. The Bank of England’s Risk Assessment Model of Systemic Institutions (RAMSI) is an example of a top-down stress-testing model and is one part of the Bank’s risk assessment toolkit. This paper offers an overview of RAMSI and provides, by way of illustration, a detailed description of its implementation as part of the comprehensive set of stress tests carried out during the IMF’s 2011 UK Financial Sector Assessment Program (FSAP).

PDFRAMSI: a top-down stress-testing model

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