samchain/econo-pairs-v1 huggingface dataset:
Ivan Iskrov: Global and regional challenges to the economy and the financial system. Do we have working solutions? Opening address by Mr Ivan Iskrov, Governor of the Bulgarian National Bank, before the International Scientific Forum “Global and Regional Challenges to the Economy and the Financial System: Do We Have Working Solutions?” organised by the VUZF University, Sofia, 10 May 2012. *  *  *  Dear Mr. Rector, Dear Participants and guests of the conference, Ladies and gentlemen, It is an honour and a pleasure for me to take part in the opening of this International Scientific Forum organized by the VUZF University. I would like to thank its Rector, Prof. Vazov for inviting me, and through him to congratulate the University on the occasion of its remarkable 10th Anniversary. The academia are famous for their conservatism but here, only a decade after its foundation, your University established itself as one of the leading universities in Bulgaria in the area of finance and insurance. An example of the high European standards to which the VUZF University aspires, are the joint bachelor’s and master’s degree programmes with the University of Sheffield. In addition, the Extended “Erasmus” University Charter awarded by the European Commission provides opportunities to VUZF University students to train and have internships at EU universities and companies. It was announced lately that in the recent five years 55 thousand people have graduated economy in Bulgaria.

For instance, focusing solely on ‘bad’ loans may be misleading if it is not accompanied by the clarification that the assets in the banking system balance sheet are very little exposed to the risk of mark-to-market revaluations (and exactly the manifestation of that risk became the biggest problem in many of the “advanced” banking systems). Furthermore, it is very common in Bulgaria to comment on the gross non-performing (over 90 days past-due) loans ratio, whereas the economically more significant ratio is the “net non-performing (over 90 days past-due) loans/net loans” ratio – it correctly reflects the fact that the risk has already been taken into consideration in the income statement through the impairment costs that banks have actually made. Also, as a rule, net non-performing loans represent the part of the loan portfolio covered by highly liquid (and acceptable under the BNB‘s high standards) collateral. Net non-performing loans in Bulgaria hold a share of 10.71% at end-March 2012. What I mean to say is that the analyses and conclusions about non-performing loans across countries are useful only when they are based on comparable values. Despite the objective indicators, all the resilience and adaptability of the economy and banking system in Bulgaria remain unnoticed by many international observers and the leading world media. Even the analyses made by European and international organisations, known for their high expertise, still lack understanding of the economic specifics in the different countries.
This might lead to higher risk premia and higher nominal interest rates that would undermine the effectiveness of such a policy to stimulate the economy. In addition to communication strategies, the Federal Reserve has a second set of tools, namely the ability to expand its balance sheet to stimulate activity and move inflation toward desired levels – either by purchasing medium and long-term Treasuries or agency mortgagebacked securities. Such purchases of long-duration assets pull down the level of long-term interest rates by removing duration from private-sector hands, who respond by purchasing other long-dated assets. Two interesting questions pertain to balance sheet expansion: (1) How much would the Fed have to purchase to have a given impact on the level of long-term interest rates and economic activity, and, (2) what constraints exist in terms of limits to balance- sheet expansion, and what are the costs involved that could impede efforts to meet the dual mandate now or in the future? The questions demand serious consideration prior to any decision to expand the balance sheet further. With respect to the first question, some simple calculations based on recent experience suggest that $ billion of purchases would provide about as much stimulus as a reduction in the federal funds rate of between half a point and three quarters of a point. But this estimate is sensitive to how long market participants expected the Fed to hold on to these assets.

That’s why the FSB is now developing new policies to address liquidity, leverage and securities financing risks in asset management activities. These measures will help ensure asset managers can provide sustainable and reliable financing to EMDEs. That’s why the FSB is working to ensure the central counterparties that support the plumbing of the new system are resilient and can be resolved without disruption to the flow of financing to the real economy. And that’s why FSB members are working to develop more effective macro prudential policies. These will dampen the impact of capital flows on domestic vulnerabilities and allow countries to be more open and connected to global trade and investment. The FSB’s work plan is highly complementary to other G20 priorities in infrastructure, inclusiveness and climate change. A FAIR system is essential if we are to move to a 2 degree world. A FAIR system is critical to achieving the economic and moral imperatives of the SDGs. I look forward to our discussion of how to build such a system to the benefit of all. 15  BIS International Debt Statistics, (all sectors, nationality basis). 16  IMF World Economic Outlook data show that average annual portfolio flows to EMDEs have more than tripled from their average in the decade prior to the crisis to an average of $ billion annually between 2009 and 2015. BIS central bankers’ speeches  5
For example, quality engagements with first-time buyers and the underserved will go a long way in closing the huge protection gap which remains our most important priority right now. We will also be looking more closely at the experience with direct distribution channels to date. We would like to see greater impact from direct channels, including online or mobile platforms, in supporting higher insurance penetration. Today, the Millennials and iGeneration expect significant technological innovations in the entire chain of insurance experience – from product comparisons, purchase, claims, and customer support. The industry cannot ignore this fact as they will become the key customer segment in the near future. Further attention also needs to be given to the role of shared infrastructure to support insurance undertakings, building further on the fraud and motor insurance databases. From the Bank’s perspective, our aim is to facilitate innovation in three main ways. First is by lowering the barriers to innovation and competition. This is achieved by providing an environment through the regulatory sandbox for the industry, including non-insurance firms, to test innovations without costly regulatory reprisals. It also allows the Bank to appropriately tailor our rules to better suit innovations as we too, learn from observing the solutions that are tested in the sandbox. Second is through proportionality. We aim to better reflect proportionality in our regulatory framework.

Nor Shamsiah Mohd Yunus: Innovation in a disruptive era Remarks by Ms Nor Shamsiah Mohd Yunus, Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Malaysian Insurance Institute (MII) Summit "Innovation in a Disruptive Era", Kuala Lumpur, 28 September 2018. * * * I would like to congratulate the Malaysian Insurance Institute for organising this summit. This is my inaugural engagement with the industry and it gives me great pleasure to be able to address all of you today. In line with the theme of this conference, my remarks today will cover three things: 1. Firstly, the role of insurance within the context of key developments that are shaping our economy; 2. Secondly, how the Bank views and is responding to innovation in the insurance sector; and 3. Finally, some perspectives on our regulatory and supervisory focus moving forward. Role of insurance in an economy Insurance plays a core function in the modern economy and the financial system. There is a positive relationship between economic growth and insurance development. This is borne out by studies which have shown that more developed markets have a higher share of insurance in the economy. The role of insurance in the economy is worth restating, particularly given the economic and social challenges that we face today. A core purpose of insurance is providing protection against individual and business risks through risk transfer and pooling. This improves individual welfare, and supports consumption and investment activities.
3 While Norges Bank seeks to maintain the sum of the reserves in the banking system around NOK 35 billion, the sum of banks’ quotas is NOK 45 billion, so that banks as a whole can always deposit the reserves outstanding in the banking system at the key policy rate. Should the volume of reserves exceed the sum of banks’ quotas, some banks would have to hold reserves at the reserve rate. That would push down the overnight interbank rate towards the reserve rate. But for that to occur, Norges Bank would have to stop withdrawing surplus liquidity through market operations. There are no plans to make such a change to our liquidity policy. The reserve rate in Norway is now at a negative 0.25 percent. But this will not lead to negative money market rates. With normal liquidity management, which ensures that there are no excess reserves in the system, the key policy rate – not the reserve rate – determines  1  Similar quota systems are in use in Denmark, Switzerland and New Zealand. For a more general discussion of liquidity management systems, see Syrstad, O. (2011): “Systemer for likviditetsstyring: Oppbygging og egenskaper” [Liquidity management systems: design and features], Norges Bank Staff Memo 5/2011 (Norwegian only). Banks’ feedback on the current liquidity management system, introduced in October 2011, is discussed in Norges Bank Papers 4/2014: “Banks’ assessment of Norges Bank’s liquidity management system”.

BIS central bankers’ speeches  7  Some notable points include:   Over the period 2010 to 2050, the average scale of capital inflows, relative to market capitalisation, for the G20 emerging markets is around 8% per year. That is greater than the peak inflow experienced in the recent past, including in 2010, during which time asset prices rose significantly and protective policy measures were put in place.   Given the likely variation in these inflows year by year, the picture is even more striking. Potential “peak” inflows are into double digits for the majority of G20 emerging markets. As context, peak portfolio equity inflows to East Asian countries in the three years preceding their 1990s crisis averaged 4% of market capitalisation.   For some individual emerging market countries, these capital inflow patterns are dramatic. For example, over the period 2010–2050, average inflows to India and Indonesia exceed 10% of their equity market capitalisation. Taken together, these projections do not suggest a dissipation of the BFSP problem. More likely, they suggest it could intensify, perhaps significantly, in the period ahead. If capital markets operated efficiently, these portfolio flows need not cause waves in emerging credit and asset markets. In practice, frictions in the functioning of these markets mean that asset market spillovers seem very likely to persist. In other words, the splashes from the big fish risk causing waves every bit as great, and potentially greater, than those seen recently.
This brings me to the FX Global Code and its global implementation, which I will share more about today. Launch of the FX Global Code The FX Global Code was launched in May 2017 by the Bank for International Settlements (or BIS). It was developed over 2 years by the BIS Foreign Exchange Working Group (or FXWG), which comprised central banks from the key FX jurisdictions. The effort was also supported by a public-private partnership between the central banks and active engagement from key FX market participants. The private sector participants included the sell-side, buy-side, trading platforms and other market infrastructure. What we have now is a single, global code of conduct for the wholesale FX market. Benefits of the Code How will the Code benefit the FX market? Let’s take a step back and look at the nature of the wholesale FX market. It is inherently complex: Activity takes place across multiple venues; there is no single trading venue and no single price. Trading happens 24 hours a day, spanning multiple centres, with the day’s trading starting in 1/6  BIS central bankers' speeches  New Zealand, Australia, and moving to Singapore and London as the day progresses, before ending in New York. Participation is diverse – with banks, asset managers, corporates, and central banks, each transacting FX to meet different objectives. Participants act as principals or agents, and the responsibilities pertaining to each may not be well understood. Hence, there could be market failures, asymmetry in information and potential conflicts of interests.

Together, we can raise standards, professionalism and accountability of market participants within the FX market in Singapore and globally. On that note, I hope that you will have good discussions and a fruitful conference ahead. 1 Source: BIS Triennial FX Surveys. 2 By signing the Code, a market participant represents that it (a) supports the Code and recognises it as a set of  principles of good practice for the FX market; (b) is committed to conducting its FX market activities in a manner that is consistent with the principles of the Code; and (c) considers that it has taken appropriate steps, based on the size and complexity of its activities, and the nature of its engagement in the FX market, to align its activities with the principles of the Code. 3 The assessment would take into account issues such as the breadth of adoption of the Code, the effectiveness  of adherence mechanisms, the extent to which behaviour in the market has changed and the effect of the Code on market functioning. 4 BIS press release, 25 May 2017, “Central bank Governors welcome global code of conduct for currency  markets” 5 Source: 2016 BIS Triennial FX Survey. 6/6  BIS central bankers' speeches
Political and institutional framework A further prerequisite for Swiss financial service providers to compete on an international level is a sound political and institutional framework. Switzerland has long had stable political relations, legal certainty, efficient authorities, and a solid and secure infrastructure. This constitutes a strong underpinning for financial service providers. But let us not rest on our laurels. We must try to avoid creating any administrative hurdles that neither contribute to stability nor bring any great benefit, but instead unnecessarily restrict the activities of financial service providers. Transfer stamp tax and withholding tax, for instance, curb the potential for growth in Switzerland. The reform of the withholding tax system and the abolition of transfer stamp tax on domestic bonds are expected to strengthen the Swiss capital market. 2 This would not only benefit the financial sector, but also improve the financing options available to companies. It would also benefit small and medium-sized enterprises, for which such opportunities have been very limited until now. 2  Cf. Roadmap for financial market policy Switzerland 2020+, Advisory board for future of Swiss financial centre, 2019. Page 4/5  Open market access Switzerland undoubtedly owes much of the prosperity it enjoys today to open markets and thriving trade. However, for the export-oriented parts of the Swiss financial industry, limited market access continues to be an obstacle restricting growth potential. Market access to some countries has deteriorated since the financial crisis. This especially affects wealth managers who are operating in our relatively small domestic market.

We observe a downward trend of productivity growth – which is considered by some as “secular”, jumping perhaps too hastily to a very long-term conclusion. Furthermore, the ageing of the population means the labour supply is shrinking and potential growth is falling. Thanks to Japan’s G20 Presidency, the challenges posed by demographics are now on the agenda. The ECB’s monetary policy has played an important role in supporting the recovery of the euro area: estimates put the cumulated impact on growth at around 2.5 pp and on inflation at between 1 and 1.5 pp for the period 2014–181. In addition, 11 million jobs have been created since 2013. In September, the ECB introduced a further package of measures. Although it has received less attention, the most innovative part of this package is the strengthening of the state-dependent forward guidance on interest rates. Conditional on inflation developments, this will act as an automatic stabilizer through adjustments in the yield curve and financial conditions. In other words: what does matter is not only the level of our key short term interest rates, which are currently anticipated by markets, reasonably in my view, as close to bottoming out ; it is also and foremost the time horizon of our policy measures Clearly, monetary policy will be all the more effective if it will no longer be the only game in town. You may not realise it, but the euro area has more policy room than others in non-monetary domains, but under-uses it.
But credit cards are not common in Zambia as only a few banks issue them while most cards held by residents have been issued offshore. This initiative taken by Access Bank should directly contribute to an increase in the number of people holding such cards and taking advantage of the range of benefits that can be derived from their use. In countries where credit cards are used extensively, their benefits for users are commonly recognized and include: •  Elimination of the risk associated with carrying large amounts of cash as it may be lost or stolen. Credit card companies have over the years developed a variety of anti-theft practices which protect the cardholder in the event of theft of the card. In any case, the cardholder is protected from fraud on the card except in event of negligence on his/her part;  •  Cards make it easier to buy things as one can pay for a range of goods and services from small items to airline tickets, hotels, car-rentals etc.

Cards can be physically stolen or credit card numbers can be acquired by thieves over the phone, internet or website and then used illegally to rack up debts. Access Bank must therefore, develop adequate security measures that can protect it and its clients from the crimes which seem to pervade the electronic based payment platforms. To fight this crime, you will need to educate your customers on how to safely and securely conduct transaction using their cards. You will help prevent fraud by educating your customers on what to do when they lose their card or wallet, how to secure their card by, for instance, not giving out credit card information anyhow or on the website and the need to check statements closely. On their part, cardholders must also do their part as responsible  2  BIS central bankers’ speeches  cardholders, including paying off balances on credit cards as required, not loaning credit cards to others or divulging credit card information to anyone not entitled to it. Chairman, Ladies and Gentlemen, let me reiterate my words of commendation to Access Bank for introducing this product on the market. It is a great product which when used properly will benefit both the bank and its customers. This outcome is however, predicted on customers using the card wisely and responsibly and on the bank issuing cards to clients after a careful vetting and scrutiny and charging fair interest on the product. Failure to choose creditworthy customers will lead to defaults which may trigger excessive charges.
23  All speeches are available online at www.bankofengland.co.uk/speeches  23  Conclusion Before the great wave of globalisation, a series of major institutional reforms increased the transparency and accountability of central banks. The enhanced monetary policy credibility that this brought resulted in a marked drop in inflation and sizable reduction in the sensitivity of inflation to changes in slack. By driving greater competition, increased globalisation has reinforced the effectiveness of these reforms. 57  Monetary policy makers, including the MPC, drew on this credibility during the financial crisis, keeping inflation expectations anchored in the face of deflationary pressures from both home and abroad. Regardless of how external influences on inflation evolve in future, the institutional framework of the Bank of th  England, which is currently celebrating its 20 anniversary of independent monetary policy, leaves the MPC well equipped to deliver price stability. The biggest determinants of the UK’s medium-term prosperity will be the country’s new relationship with the EU and the reforms that it catalyses. Many of the adjustments needed to move to that new equilibrium are real in nature, and are not in the gift of monetary policymakers. But monetary policy can help build the foundations for lasting prosperity by achieving the inflation target in a way that helps smooth real adjustment in the economy and supports jobs in the wake of very large external forces. This is the best contribution the MPC can make to the good of the people of the United Kingdom.

11 Headline CPI inflation averaged 1.9% over this period. 6  All speeches are available online at www.bankofengland.co.uk/speeches  6  Chart 5: Sustained, cumulative relative price shock in goods accommodated through higher services price inflation  Notes: Six-month average of the log-difference between core goods prices (excludes food and energy) and services prices (series indexed; 2005 = 100). The US series uses PCE price indices. Sources: Thomson Reuters Datastream, national sources and Bank calculation. Globalisation has also led to a dramatic increase in the use of imported intermediates in domestic production. The ICT revolution has made a great unbundling of production into global value chains possible, and large wage differentials have made doing so profitable. Intermediate goods trade has represented 80% of the increase in total trade over the past two decades (Chart 6), driving up the value added of imports as a share from 10% of exports in 1990 to around 20% in 2015. 12  12  See Auer, R, Borio, C and Filardo, A (2017), ‘The globalisation of inflation: the growing importance of global value chains’, BIS Working Paper No. 602. 7  All speeches are available online at www.bankofengland.co.uk/speeches  7  Chart 6: The development of global value chains has boosted trade in intermediates  Notes: Imports and GDP are in current US dollars. Sources: Johnson and Noguera (forthcoming), Powell (2016), World Input-Output Database (2016 release) and BIS. This expansion in global value chains has led to greater synchronisation of producer price inflation across countries.