Bank Z-Score for Luxembourg
DDSI01LUA645NWDB • Economic Data from Federal Reserve Economic Data (FRED)
Latest Value
51.67
Year-over-Year Change
50.21%
Date Range
1/1/2000 - 1/1/2021
Summary
The Bank Z-Score for Luxembourg measures the financial stability and soundness of the Luxembourgish banking sector. It is a key indicator used by policymakers and analysts to assess the resilience of the country's financial system.
Analysis & Context
This economic indicator provides valuable insights into current market conditions and economic trends. The data is updated regularly by the Federal Reserve and represents one of the most reliable sources for economic analysis.
Understanding this metric helps economists, policymakers, and investors make informed decisions about economic conditions and future trends. The interactive chart above allows you to explore historical patterns and identify key trends over time.
About This Dataset
The Bank Z-Score is a metric that combines a bank's profitability, leverage, and volatility of returns to estimate the probability of it becoming insolvent. Higher scores indicate greater financial stability and lower default risk for the banking industry as a whole.
Methodology
The data is calculated by the World Bank using confidential bank-level information.
Historical Context
Policymakers closely monitor the Bank Z-Score to inform financial regulations and macro-prudential policies.
Key Facts
- The Bank Z-Score for Luxembourg was 7.23 in 2020.
- Luxembourg's banking sector is highly concentrated, with the three largest banks accounting for over 30% of total assets.
- The Luxembourgish banking industry is dominated by foreign-owned institutions, particularly from neighboring countries.
FAQs
Q: What does the Bank Z-Score for Luxembourg measure?
A: The Bank Z-Score measures the financial stability and soundness of the Luxembourgish banking sector by combining profitability, leverage, and volatility of returns.
Q: Why is the Bank Z-Score relevant for users or analysts?
A: The Bank Z-Score is a key indicator used by policymakers and analysts to assess the resilience of Luxembourg's financial system and the probability of banking sector insolvency.
Q: How is the Bank Z-Score data collected or calculated?
A: The data is calculated by the World Bank using confidential bank-level information.
Q: How is the Bank Z-Score used in economic policy?
A: Policymakers closely monitor the Bank Z-Score to inform financial regulations and macro-prudential policies aimed at ensuring the stability of Luxembourg's banking sector.
Q: Are there any update delays or limitations with the Bank Z-Score data?
A: The Bank Z-Score data may be subject to update delays due to the confidential nature of the underlying bank-level information used in its calculation.
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Citation
U.S. Federal Reserve, Bank Z-Score for Luxembourg (DDSI01LUA645NWDB), retrieved from FRED.