samchain/econo-pairs-v1 huggingface dataset:
Not merely were banks’ own reported profits exaggerating the contribution of the financial sector to the economy, so were the national accounts. In the US, the share of gross value added of the financial sector as a share of GDP rose from around 2–3% in the decade after World War II to about 8% in 2008, driven in large part by a rise in the gross operating surplus of financial intermediaries. And in the UK, in the past decade, the measured scale of the financial sector, compared to GDP, has roughly doubled to around 10%. But this exaggerates the contribution of financial services. Banks do not always charge directly for the services they provide. So the value added of the financial sector is measured by official statisticians (using the United Nations System of National Accounts) as the difference between interest receipts and payments of a “reference rate of interest” which attempts to measure the pure cost of borrowing funds. This convention overstates the true value added of the financial sector because it includes the return to risky lending represented by the difference between the hypothetical pure cost of borrowing funds and the return that is earned. But the fact that risk is channelled through an intermediation industry does not mean that the value added from risk-bearing in the economy is solely attributable to the existence of an intermediation sector. If companies financed themselves directly from households, the statisticians would regard the return on risk-bearing as value added created in that industry.

An important objective of such regulatory convergence is to ensure that crossborder financial linkages act to foster regional growth, while mitigating the propagation of systemic risk across borders through such linkages. The convergence of standards has proceeded in different ways in different parts of the world. In Europe, regulatory convergence has been driven by EU-level bodies and agencies, including the European System of Financial Supervisors and the European Systemic Risk Board. The EU-wide prudential rules are formulated and implemented through directives and regulations legislated by the European Parliament and European Council, with limited room for member states to apply “national discretion”. Recent proposals to establish a single supervisory mechanism for banks led by the European Central Bank, and a single resolution mechanism, will further  2  BIS central bankers’ speeches  reinforce the role of EU-level institutions in the management of financial stability in the Euro area. With significantly more diverse economies and financial systems, promoting greater regulatory convergence in Asia is more likely to proceed on the basis of a set of shared principles for developing and maintaining sound financial systems, while providing for the unique and distinct legal, financial, social and economic structures of individual countries within the region. It will be important to have clarity around the key principles, an inclusive process in agreeing on these principles, and mechanisms that support their effective implementation in individual countries.
2  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  2  The deepening of the symbiotic relationship between global markets and technological progress has lifted more than a billion people out of poverty (Chart 2), while a series of technological advances have fundamentally enriched our lives. Chart 1: 3 ½ billion people have internet access  Chart 2: 1 billion fewer people live on less than $ a day since the early 1980s  Billions of people  Billions of people  3.5  2.0 1.8  3.0  1.6 2.5  1.4 1.2  2.0  1.0 1.5  0.8 0.6  1.0  0.4 0.5  Number of poor at $ a day (2011 PPP)  0.2  0.0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016  0.0  Source: Internet Live Stats. An internet user is defined as an individual who can access the Internet at home, via any device type and connection. 2015 and 2016 are estimates. 1981  1986  1991  1996  2001  2006  2011  Source: World Bank. $ a day is the World Bank’s current global poverty line. Globally, since 1960, real per capita GDP has risen more than two-and-a-half times (Chart 3), average ii  incomes have begun to converge, and life expectancy has increased by nearly two decades (Chart 4).

These are the Top Islamic Bank and Top Development Financial Institution awards to recognize these two categories of institutions for their contribution towards the overall business growth of CGC and the SME sector. These new categories illustrate our sincere acknowledgment of the financial institutions that have made significant contribution to SME development. We believe 2008 is an important year for CGC. Foremost is that it marks the 36th year of the Corporation's involvement in SME development. It is also the year which will see the implementation of the third phase of our three-year business transformation plan and the successful completion of the three-year strategy. The necessary preparatory work under the transformation plan has largely being completed and we hope to take the first step towards achieving financial sustainability. Another significant milestone in 2008 is the establishment of the SME Credit Bureau, a watershed event in CGC's evolution. The Bureau is a source of credible and reliable credit information that serves the needs of both the SMEs and the potential financiers. This reflects the natural progression for the CGC in its continuous efforts to enhance access to financing by SMEs. The establishment of a SME Credit Bureau, by CGC in strategic collaboration with Dun & Bradstreet, would no doubt complement the other initiatives of the Government and the financial sector in promoting growth and development of SMEs. We have seen how CCRIS, where real-time and comprehensive information on consumers' credit exposures and history is readily available.
It is critical that we move forward thoughtfully to ensure a financial system for the ages and for all segments of society. 5/5  BIS central bankers' speeches

For example, establish a shared infrastructure that enables more efficient tracking and monitoring of the performance and impact of the programme on the target segments. This would also enable financial institutions to better intermediate social impact funds to deliver the SDGs. Conclusion Achieving the SDGs is a collective effort – one that requires a whole-of-nation approach. Each of us, be it the financial institutions, the customers, the regulators, the government and funds providers play an important role in creating a better, safer and sustainable future. Indeed, such collective effort is equally warranted across geographical borders and governments. In Malaysia, we recognise this. Therefore, I welcome individuals or organisations that are passionate about SDG to collaborate with Malaysia and partner with global organisations such as UNDP to codevelop the areas mentioned by leveraging on Malaysia’s strengths to achieve SDG goals together. In addition, I would also like to invite such individuals and organisations to take part in the Royal Award for Islamic Finance Impact Challenge Prize 2022. This new initiative by Malaysia aims to reward innovative creations and solutions that strengthen the economic and social resilience of financially impacted communities globally through the application of Shariah principles. Applications are open until 25 March 2022. To end my speech, I wish you every success with today’s conference and I trust the event will generate interesting conclusions and concrete actions. Thank you.
This obviously had an impact on bank solvency, giving rise to significant capital requirements for some banks, which needed public support to cover the capital shortfalls identified. Since then, the situation has improved considerably, with the help of the monetary policy measures implemented by the European Central Bank to ensure that solvent banks had sufficient funding. Against a background of significant decline in banking activity, banks have managed to reduce the weight of troubled assets in their balance sheets very significantly. Specifically, 7/17  the NPL ratio has fallen by more than eight percentage points to stand at 5.8% of total lending. Foreclosed assets, meanwhile, are only 50% of the level recorded in 2014, so that their weight has been reduced to 3.6% of assets, vis-à-vis the resident private sector. Active management of these assets by banks, under supervisory pressure, has played a very important role in this process. In any event, there is still significant room for improvement; before the international financial crisis, the NPL ratio was below 1% and foreclosed assets were practically non-existent. The restructuring of credit institutions is also reflected in the reduction in the weight of the real estate sector (broadly defined),2 which stood at 52% of GDP in 2018, as compared with 99% in 2008. 2  Loans for house purchase, plus loans to businesses in the construction industry and related areas.

•  And looking ahead, if foreign exchange transactions become centrally cleared, what role can and should CLS play to facilitate the safe settlement of those transactions? •  I’d note, CLS has plenty of strategic choices there, always a good sign. Second, CLS was created by private sector leadership and financial institutional commitment and industry collaboration is a key part of a successful future. •  CLS cannot do its work alone. What makes CLS successful are members who are proactive in identifying and working with CLS on opportunities to further strengthen the CLS ecosystem, particularly in a market that is rapidly changing. •  That will require not just member support but also member investment. Third, the birth of CLS and its development exemplifies the productivity of public sectorprivate sector collaboration. We have different roles, but a common interest in the performance and resiliency of the foreign exchange market. As we play our respective roles, we can make each other more insightful and better performing. We have done that here in foreign exchange settlement – and speaking personally, I would like to see private sector and public sector tackle more opportunities across the financial markets. Let me end by congratulating CLS and all who are part of it on these first 10 very successful years, thank the wider group here for the collaboration you have developed within the industry, and thank you also for the partnerships you have forged with central banks, most especially, with the Federal Reserve Bank of New York.
16  Recent summaries of the literature are contained in Deutsche Bundesbank (2016) and Monnin (2017). The Bank of England working paper on this topic (Bunn, Pugh and Yeates (2018) on which this speech draws) contains a good survey of the recent literature. 17 April 2017 NMG Consulting survey of households, as discussed in Bunn et al (2018). 6  All speeches are available online at www.bankofengland.co.uk/speeches  6  Assessing the Quantitative Impact of Monetary Policy  We develop a quantitative framework to measure the impact of monetary policy on the economy as a whole and on different cohorts within it. We use the UK as a case study. The framework draws heavily on recent research by Bank of England staff, Phil Bunn, Alice Pugh and Chris Yeates. Their working paper contains 18  full details of the exercise, which involves three broad steps. As with any quantitative analysis, there are of  course uncertainties and confidence intervals around the results. As such, the broad qualitative conclusions are probably worth emphasising more than any precise figures. Step One: Starting Distributions  The starting point is an initial set of distributions for the variables of interest, looking across a representative sample of households. For this exercise, data are taken primarily from the Wealth and Asset Survey (WAS), a biennial survey of UK households’ assets and debts. 19  Specifically, we focus on a fixed panel of 10,000  households across 4 waves of this survey between 2006-08 and 2012-14.

Some households will have seen these benefits through higher employment, others through lower debt payments, others still through higher wealth. Even if people observed and understood all of these channels, their lived experience would have been quite different. In practice, we know people’s understanding of these channels is partial and imperfect. Some channels are hard to observe or take time to take effect, such as the quantitatively important effect of monetary policy in boosting jobs and hence household labour income. It will have been difficult for households to tie the effects of looser monetary policy to their improved job prospects, given the long lags in transmission. People’s subjective sense of well-being might also be influenced by more than their percentage gains. How people’s gains, in money terms, compare with others’ monetary gains might also matter. In experimental and real-world settings, these relativities often matter to people’s sense of fairness and hence well-being. 30  With that in mind, we now turn to a fully-fledged welfare analysis of the impact of monetary policy. Assessing the Welfare Impact of Monetary Policy  Assessing the impact of monetary policy on the welfare of different cohorts is interesting for several reasons. First, it is the sum of individuals’ subjective well-being – that is, social welfare – that ought ultimately to matter for policymakers, even though policymakers’ legal mandates are typically cast in terms of a set of more objective macro-economic measures, such as inflation and employment.
In the course of the very powerful upturn in the American economy, significant imbalances have built up at the same time. Among other things, the deficit in the current account has never been as great as it is now, and recently consumption has been increasing more rapidly than household incomes, which means that the savings ratio has been at a record low. Sooner or later these imbalances will need to be corrected. However, a discussion of how this might come about lies beyond the bounds of what I intended to talk about this evening. Are there traces of a “new economy” in Sweden? –  Since Sweden switched from a fixed exchange rate to an inflation target, monetary policy has been designed so as to reach this target and thereby create credibility. Monetary policy has succeeded in stabilising prices and at the present time long-term inflation expectations approach the Riksbank’s target of 2%. The changes in fiscal policy, which have entailed among other things a reform of budgetary procedures and the imposition of a ceiling on public expenditure, have had positive effects. This is manifested, for example, in the budget surpluses now being produced. Overall, we have made good progress towards achieving macroeconomic stability and therefore appear to fulfil the requirements for “good economic policy”, even if we have fulfilled these for a considerably shorter time than the USA. –  If, on the other hand, we look at structural factors, our problems were perhaps also worse from the start.

This serves the interests of governments and taxpayers; but it is also in the fundamental interests of the financial system itself, since it is not impossible that a future crisis could outstrip the resources of monetary and fiscal policy, thus rendering it impossible to rescue systemically important banks. 2.  International approach  Consequently, there is broad international consensus between the relevant authorities on what the objectives of future regulatory measures should be. The Financial Stability Board (FSB), in which Switzerland is an active participant, has clearly formulated these objectives. The financial system must be brought to the point where it contributes to sustained economic growth. Never again must it be allowed to combine such high risks with such minimal safety buffers. Moreover, steps must be taken to avoid profits being privatised while losses are borne by the public at large. In essence, there are two ways of achieving this goal. The first approach is to adopt preventative measures aimed at reducing the probability of a bank collapse or a systemic crisis. This can be done by increasing safety buffers – for example, by imposing higher capital and liquidity requirements. The second approach is to take steps designed to reduce the costs of a crisis once it has already occurred.
First up, how the new accounting standard interacts with the bank capital framework here in the UK – a most enjoyable discussion, because you can never have too much of accounting standards. Next on the menu: consumer credit, of which you definitely can have too much. Some of the most difficult issues greeting our return, however, were not so domestic in nature. Would cross-border reinsurance contracts function properly in the wake of Hurricane Irma? How might a bad outcome on the Korean peninsula affect British banks and financial markets? Supervisors of the world's leading international financial centre have always had to juggle domestic and global risks. In between them, however, is a dynamic which is fundamental to retail and wholesale finance in the modern economy. It is a dynamic at play in the cliff-edge risks from Brexit and the differences of view between countries over Basel 3 finalisation. I am thinking of the impact of borders, location and distance on the shape of banks, insurers and financial regulation. Put simply: the impact of geography on the geometry of finance, a dynamic we might call 1  geofinance . With the revolution in regulation following the financial crisis coming to its end, and with changes to the geopolitical landscape looming large, I think that geofinance is likely to be the defining challenge of the next few years. The domestication of retail banking  Soon after the crisis I worked with the Independent Commission on Banking (ICB).

Although, Islamic finance institutions are mainly founded in the Middle East and South-east Asia, the interest has extended to Europe and the United States. Today, the size of Islamic banks around the world is estimated to be more than USD 250 billion and expected to grow by about 15 percent annually. Due to the growing importance of the Islamic finance, the Islamic Development Bank (IDB) was established in December 1973. The purpose of the Bank is to foster economic development and social progress of Muslim communities individually as well as jointly in accordance with the principles of Islamic Law. The number of members to the Bank is steadily enlarging and currently consists of 56 countries. The primary functions of the IDB are to participate in equity capital and grant loans for productive projects and enterprises besides providing financial assistance to member countries in other form for economic and social development. The Bank is also required to establish and operate special funds for specific purposes including a fund for assistance to Muslim communities in non-member countries, in addition to setting up trust funds. The Bank is authorized to accept deposits and to mobilize financial resources through Shari'ah compatible modes. It is also charged with the responsibility of assisting in the promotion of foreign trade especially in capital goods, among member countries; providing technical assistance to member countries; and extending training facilities for personnel engaged in development activities in Muslim countries to conform to the Islamic Law.
In addition, low interest rates and, in general, more accommodative financial conditions naturally have a positive impact on economic activity and employment and help stimulate the flow of credit, thus also driving up banks’ profitability. Indeed, this is the key rationale behind an expansionary monetary policy such as that implemented in the euro area in recent years. As an illustration of these effects, according to various ECB  12/29  studies2 and the Banco de España’s own estimates, the set of monetary policy measures adopted since mid-2014 will have an overall impact on real GDP growth in the euro area of around 2 pp in cumulative terms between 2016 and 2020. Moreover, these estimates do not include the measures agreed in September which, according to the Banco de España’s estimates, could add up to 0.4 pp in cumulative terms to euro area GDP growth by 2021. In any event, it is fair to say that there is evidence that, since the ECB’s deposit facility rate fell below zero, negative surprises in short-term interest rates have been accompanied by falls in European banks’ stock market valuations. Given the endogenous nature of the monetary policy response to projected economic developments, this response by bank share prices to monetary surprises may reflect, on the one hand, the negative impact of less favourable projections for the future macroeconomic setting and, on the other, the market view on the direct negative effect of further interest rate cuts on banks’ future profitability against a backdrop of a prolonged period of negative rates.

But there is much to suggest that fiscal policy as early as next year that is, the policy which is being decided this autumn - will be important in this context, at least if the timing that is now being discussed, with full participation in 2005 or 2006, is achieved. Thus, more and more of stabilisation policy's burden is transferred to fiscal policy. But this does not mean that the Riksbank should refrain from using the scope for monetary policy that may exist during the ERM2 period. It is up to the Riksbank to do what is possible to make Sweden's accession to the monetary union smooth and stable. Low and stable inflation in Sweden is one important element here; another is a stable exchange rate. Sweden must fulfil the convergence criteria in both these respects. In practice this means that there may be grounds for continuing to produce inflation forecasts and to publish Inflation Reports in much the same way as at present. We should also do what we can with the interest rate to direct inflation onto our target. But the closer we come to adopting the euro, the smaller will be our repo rate's effect on longer term interest rates. That is because as the entry date approaches, the Swedish yield curve will be increasingly determined by European interest rates. BIS Review 65/2002  5  The fact remains that exchange rate stability is one of the convergence criteria for Sweden's full participation in the monetary union.