samchain/econo-pairs-v1 huggingface dataset:
Hamad Al-Sayari: A brief overview of the Saudi Arabian banking sector Speech by His Excellency Hamad Al-Sayari, Governor of the Saudi Arabian Monetary Agency, at the opening of a branch of the National Bank of Kuwait, Jeddah, 6 May 2006. *  *  *  Dear Audience, It gives me great pleasure to be here tonight to inaugurate the branch of the National Bank of Kuwait (NBK) in Jeddah, a city which has long been known for embracing the business sector due to its closeness to the sacred places and its unique location on the Red Sea. The commencement of NBK of its banking operations in the Kingdom of Saudi Arabia marks further consolidation of cordial relations between the two brotherly countries (Saudi Arabia and Kuwait). This is one of the fruits of mutual Gulf work which the leaderships of the two countries are keen to enhance. Dear Brothers, The inauguration of NBK branch comes at a time when the Kingdom is witnessing robust economic performance. In 2005, the Saudi economy grew in real terms by 6.5 percent; the private sector registered a real growth of 6.6 percent. What is reassuring is that the private sector has become the main impetus of the Saudi economy. Its average growth rate for the past years stood at 5.3 percent.

Unfortunately, the international environment is rarely stable: we have lived through many financial and other crises, we have just come through a pandemic and we are all aware of the geopolitical challenges across the world. We will overcome current and future challenges as we have done so in the past – by constantly evolving to meet the needs of the nation and of the world. In recent years, Hong Kong’s role has further evolved to include providing a pathway for the ever-expanding international use of the RMB. That will remain our key task for the foreseeable future. Our unique and irreplaceable role in connecting the Mainland and the rest of the world will continue to provide us with many exciting opportunities that we must be ready to seize. 18. I am sure the TMA and all its members will continue to participate actively in this journey to support Hong Kong’s status as an ever-evolving and highly resilient international financial centre for the mutual benefit of the nation and the international investment community. Thank you. 1 Source: The Global Financial Markets Association (GFMA) and Boston Consulting Group’s  (BCG) report “Climate Finance Markets and the Real Economy” https://www.sifma.org/wpcontent/uploads/2020/12/Climate-Finance-Markets-and-the-Real-Economy.pdf 2 Source: The PBoC Governor Yi Gang’s speech on 16 April 2021  https://www.bis.org/review/r210416a.htm  Last revision date : 16 September 2022
New concepts in various facial or voice recognition techniques could be demonstrated by the developers in the Fintech Innovation Hub to gather feedback from potential users and to receive regulatory guidance from supervisors at an early stage. This should help shorten the time-to-market of useful industry-wide solutions. Second, I envisage that the Fintech Innovation Hub will also benefit the HKMA. In this place, we could explore with innovators options and possibilities of using new technologies, such as Big Data Analytics and other “regtech” initiatives, to achieve our objectives  BIS central bankers’ speeches  3  more effectively without creating undue risks or burden for our internal systems or databases. Fintech Supervisory Sandbox 16. Meanwhile, there is also a quite commonly-held perception that the development of Fintech in the financial services sector in Hong Kong has been slow. I do not subscribe to this view, at least insofar as the banking sector is concerned. In the past few months, banks and stored value facility operators have already launched new payment facilities built on smart phones and Near Field Communication technology. These facilities have the potential of altering fundamentally the way consumers make payments. Many banks have also reported to the HKMA their intention to roll out very soon new technology with a view to providing more secure and efficient services to customers. I mentioned earlier biometrics authentication technology involving voiceprints and fingerprints. This is indeed something that many banks are planning to roll out.

Contrary to what we saw during the debt crisis of the 1980s, the problems in Asia were not almost exclusively macroeconomic in nature; even if these countries suffered, all of them, from some deficiencies in this respect, by and large they had long track records of successful economic management. Rather, in a context dramatically changed by a major realignment between the dollar and the yen, and important differences in short-term yields, three other factors helped trigger the crisis: • •  the weakness of their public and private banking and financial structures; an unsustainable accumulation of short-term financing - particularly of interbank lending, which Alan Greenspan refers to as the Achilles’ heel of the BIS Review 43/1998  -2-  •  international financial system - which made countries particularly vulnerable to a sudden shift in market sentiment. and, last but not least, deep-seated problems of governance, corruption, and what US commentators call “crony capitalism”. Together with the macroeconomic problems, these three major factors had to be addressed for our response to the crisis to be pertinent. If you examine our programs with Thailand, Korea, and Indonesia, you will see that we have tried to deal with these factors, and they will have to be taken into consideration in the future in whatever efforts are undertaken to avoid the recurrence of crises. But even that will not suffice.
One important channel is the exchange rate channel. Changes in the krone exchange rate affect economic activity in some business sectors and prices for imported goods and services. The krone exchange rate has acted as a shock absorber, as it did in 2014. A sharp depreciation of the krone dampened the negative effects of the fall in oil prices on the real economy. A low key policy rate contributed to underpinning a weak krone. At the same time, the responsible actions of the social partners restrained domestic cost inflation. The exchange rate and the interest rate differential will continue to be important factors ahead. The key policy rate also has a direct impact on household and corporate demand. The rate reduction in 2014 stimulated consumption and investment. Now that growth has gained a foothold, we can take our foot off the pedal a little. Gradually higher interest rates will reduce the pressure that would otherwise have been generated by higher activity, higher employment and higher wage growth. A third channel is often referred to as the expectations channel. For monetary policy to be effective, changes in the key policy rate must pass through to market rates. Monetary policy effectiveness increases if changes in the key policy rate influence expectations of future interest rate levels. An investment is made to provide a profit over a number of years, and mortgage payments have to be met throughout the term of the loan. So today’s interest rate level is not the only important factor.

In this regard, the main challenges facing us all (including the financial sector) when it comes to managing these risks are plain to see. Among others, I would single out a lack of harmonised definitions, ESG data gaps and the ability to measure impacts. With this in mind, I will now address certain key aspects that concern all sectors, and not just the financial sector. Main regulatory initiatives  We authorities, regulators and supervisors have been shaping the regulatory framework for appropriate management of this risk. This is still an ongoing task, but important progress has been made. At the European level, I would highlight the following: first, the EU Taxonomy Regulation,13 which establishes the bases for determining when an investment or economic activity may be considered environmentally sustainable, and lays the groundwork for other European sustainable finance regulations; and second, Directive (EU) 2022/2464 (CSRD)14 on corporate sustainability reporting, published on 14 December 2022, which updates and reinforces the rules on environmental and social reporting by the companies concerned, which are large undertakings (defined as those that meet at least two of the following requisites: balance sheet total over € million, net turnover over € million or average number of employees over 250), along with listed small and mediumsized undertakings.15  13  Regulation (EU) 2020/852  14  https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX:32022L2464  15  Article 19 bis of Directive 2013/34/EU amended by the CSRD.
Mario Draghi: ECB press conference – introductory statement Introductory statement by Mr Mario Draghi, President of the European Central Bank, and Mr Vítor Constâncio, Vice-President of the European Central Bank, Frankfurt am Main, 12 January 2012. *  *  *  Ladies and gentlemen, the Vice-President and I are very pleased to welcome you to our press conference. Let me wish you all a Happy New Year. We will now report on the outcome of today’s meeting of the Governing Council. Based on its regular economic and monetary analyses, the Governing Council decided today to keep the key ECB interest rates unchanged, following the 25 basis point decreases on 3 November and 8 December 2011. The information that has become available since early December broadly confirms our previous assessment. Inflation is likely to stay above 2% for several months to come, before declining to below 2%. At the same time, the underlying pace of monetary expansion remains moderate. As expected, ongoing financial market tensions continue to dampen economic activity in the euro area, while, according to some recent survey indicators, there are tentative signs of a stabilisation in activity at low levels. The economic outlook remains subject to high uncertainty and substantial downside risks. In such an environment, cost, wage and price pressures in the euro area should remain modest and inflation rates should develop in line with price stability over the policy-relevant horizon.

This pattern reflects the expectation that, in an environment of weaker growth in the euro area and globally, underlying cost, wage and price pressures in the euro area should remain modest. The Governing Council continues to view the risks to the medium-term outlook for price developments as broadly balanced. On the upside, the main risks relate to further increases in indirect taxes and administered prices, owing to the need for fiscal consolidation in the coming years, and possible increases in commodity prices. The main downside risks relate to the impact of weaker than expected growth in the euro area and globally. Turning to the monetary analysis, taking the appropriate medium-term perspective, the underlying pace of monetary expansion continues to be moderate. The annual growth rate of M3 decreased to 2.0% in November 2011, after 2.6% in October. As in the previous three months, monetary developments in November were affected by the heightened uncertainty in financial markets. The annual growth rate of loans to the private sector, adjusted for loan sales and securitisation, decreased to 1.9% in November, from 3.0% in October. The annual growth rates of loans to non-financial corporations and loans to households, adjusted for loan sales and securitisation, both moderated in November, and stood at 1.8% and 2.3% respectively, with slightly negative monthly flows observed for MFI loans to non-financial corporations.
For example, the recent crisis drew the attention to the banking industry, many times blamed to have caused the global turmoil. There is no use repeating now how guilty the banks are, that is, the well-known sequence of events: the “sub-prime” lending, the “toxic” assets, the need to bail out banks and the subsequent economic and fiscal dimensions of the crisis. However, we should not turn a blind eye to the root cause: the role of politics and politicians. What about the call for “affordable housing” which was dominating the political ideology in the last two decades in the US (and not only there)? What about the related environment of low policy rates, coupled with the failure of regulators to identify and control systemic risks? Was that not really at the root of the asset bubbles and risky behaviour of the banks? We all know the answers. The “greedy” bankers are not the only ones to blame. Learning from emerging Europe At least, that is the story in the “advanced” countries. We should bear in mind that no shocks came from the so-called “periphery” of the euro area and emerging Europe. Rather, the crisis set in with the failure of financial markets and institutions in countries where they had supposedly been best regulated, most experienced and of highest liquidity. Being part of the global markets, the countries of emerging Europe became also part of the crisis. From today’s perspective, they could serve as a good example of mitigating and weathering the crisis.

This may serve as another example in this respect. After one year of much talking about them, these subsidiaries have kept doing well. There has been no withdrawing of liquidity from Bulgaria to support the parent institutions in Greece, nor have local residents moved their deposits to other banks. The banks’ shareholders confirmed their long-term commitments to stay and even expand activities in Bulgaria to exploit the opportunities on our market. Generally, the indicators of Greek subsidiaries in Bulgaria are equal or higher than the average of the system as a whole. We as supervisors and guardians of financial stability had to spend much time to dispel all the rumours and fears. These efforts were not in vain. Continuing reforms, letting banks work Governments need to stay firm in their efforts to conduct fiscal consolidation complemented by the necessary structural reforms. Politicians must not be afraid of reforms the needs for which are well understood. Even in the short run, reform-minded politicians get social and political rewards, as long as their message is clear. That has been demonstrated recently in both emerging Europe (with the re-election of a reformist government in Latvia) and also here in Greece (during the local and regional government elections last autumn). Policymakers should not yield under populist pressures. Better financial consumer protection and prudential regulations are certainly needed. But the banking industry should not be overburdened and prevented from fulfilling its traditional functions.
This clarifies how the Treaty’s mandate is interpreted by the Governing Council and gives the public clear guidance concerning its assessment of the success of the single monetary policy. Price stability is to be maintained over the medium term. According to the published definition, price stability has been defined as a year-on-year increase in the Harmonised Index of Consumer Prices (HICP) for the euro area of below 2%. Neither would deflation - that is, a persistent fall in the price level - be consistent with price stability. The annual rate of inflation in the most recent available data of around 1%, measured on this harmonised basis, is consistent with the definition of price stability. The Eurosystem has therefore enjoyed the good fortune to assume authority over monetary policy in the euro area in an environment of price stability, owing to the successful process of disinflation and convergence achieved within Europe over the past decade. Monetary policy needs a forward-looking, medium-term orientation. This takes into account the fact that monetary policy affects the price level only with variable, usually long and unpredictable time lags. It is not able to control all short-term movements in the price level. To maintain price stability, we have chosen a distinct monetary policy strategy, one that reflects the special circumstances that exist at present as well as those likely to prevail in the foreseeable future. The chosen strategy ensures as much continuity as possible with the former strategies of the NCBs.

The Governing Council does not react mechanistically to a single variable - whether this be a forecast, the exchange rate, unit labour costs or fiscal indicators - but rather takes into account the complete picture offered by all available and meaningful leading indicators of future inflation. In this context, the Governing Council analyses the economic reasons behind the projected risks to price stability. The appropriate monetary policy response to a threat to price stability will depend on the nature of the threat. The Governing Council can only understand the nature of the risk if it is presented with a full set of data. From these, it can attempt to identify the nature of the disturbance to price stability. Having identified the threat, an appropriate policy response can be selected and implemented. Internal forecasts of economic activity and inflation in the euro area can also contribute to the success of an appropriately forward-looking monetary policy. However, the Eurosystem should not be judged on, or held accountable for, the accuracy of its internal forecasts. Thus, publication of the forecasts cannot contribute to accountability. Rather, its performance in maintaining price stability in the medium term should be used by the public to judge the success of the Eurosystem. Allow me to say a few words on certain proposals made in the recent public debate, which may be deemed to suggest that the focus of monetary policy should be shifted towards objectives other than price stability.
2  BIS Review 55/2007  Who should take the blame for inflation? It is ironical that practically everyone in the society should take blame for a continuously high inflation in an economy. This is because everyone, even in a very little measure, would have contributed to facilitate inflation to raise its ugly head. It happens when people of a country believe that they can have a higher standard of living without working harder or producing more. Inflation in the long run is directly related to the amount of money which people would have for buying goods and services. When that quantity of money is in far excess of the quantity of goods and services, the general price level has to move up in order to facilitate the required volume of transactions. Hence, the magic solution for keeping inflation in check has been the production of money exactly in line with the production of goods and services in the economy. Any violation of this golden rule, for whatever the justifiable reason, would pave the way for the long run inflation to peep into the system. In this context, the Central Bank has an inalienable responsibility to take all the measures necessary to curb long term inflation. The role of the Central Bank The Central Bank takes monetary policy measures to keep the total volume of money in line with the total production and the volume of transactions in the economy.

Hence, the farmers would concentrate on producing more of carrots and less of cabbages. But, when an economy is hit by inflation, all the prices would rise simultaneously, so both carrots and cabbages seem to be equally profitable. This would confuse the producers who would now be unable to make any choice between the two products. Hence, the much desired relative price change does not occur, when an economy has been hit by inflation. Instead, the absolute prices start to change and such changes do not provide the price signals for allocating resources. Fifth, continued inflation distorts the balance sheets of companies, especially the balance sheets of financial institutions. Companies may record profits in nominal terms, but a large part of such profits are eroded in real terms by inflation. When profits are adjusted for inflation, companies would find that their performance has not been so spectacular as has been depicted by the amount of rupees they have earned. In fact, their real position has pushed them backward to a lower level. Sixth, inflation very forcefully hits the vulnerable groups with a weaker bargaining power. Such categories include housewives, students, pensioners and workers whose salaries are not linked to inflation. It would lead to continuous agitation by these groups creating social and political dissension. The country, instead of using its resources for investing in long term growth generating projects, would have to spend its energy and resources for solving such social issues. Thus, inflation is the unrivalled public enemy number one.
when the interests of the institutions and the markets do not coincide with the interests of society as a whole - the lenders’ short-term market-share philosophy at the end of the 1980s is an example of this. If means of control are needed, they should be designed as far as possible to lead to solutions that are compatible with the normal working of the institutions and markets. Some problems We can all see that interest in risk management has increased and that considerable resources are being invested here. The interest applies to both the production of new financial instruments, the emergence of new markets and the practical measuring and management of various risks. In addition, awareness is being stretched to cover new types of risk that did not previously receive the attention they deserved, such as operational risks, interest risks throughout the bank, liquidity risks and legal risks. This is essentially a positive development, but let me nevertheless conclude by pointing out  BIS Review 10/2004  3  some phenomena and situations, which indicate that the new developments have also brought about problems that need to be discussed and hopefully solved. The best known example is perhaps the LTCM debacle. The hedge fund suffered a sudden decline in value, which led to a confidence crisis among customers and it had to be shored up with liquidity infusions of many billions of dollars from a group of banks.

BIS Review 10/2004  1  The authorities responsible for the institutions and for financial stability, mainly Finansinspektionen (the Swedish Financial Supervisory Authority) and the Riksbank, had not built up sufficient competence regarding the financial risks. Nor did the legislation suffice as a basis for the authorities to limit imprudent credit-granting. The oversight of the banks and other credit-granting bodies therefore became formalistic and fragmentary. We were not always looking in the right places. In defence of the banks’ management and the authorities it can be pointed out that risk assessment was made difficult for many different reasons. Several important factors counteracted a sound financial development, such as the high inflation rate, misleading tax incentives and central government subsidies. In addition, there was a lock-in effect in that currency regulation, which was in force until 1989, had kept our capital inside Sweden and contributed to a form of hothouse effect. The banks did not take these factors into account in their risk assessment, or not to a sufficient degree. They then suffered the consequences when the government made some decisions that were desirable in themselves, but which altered conditions drastically. Inflation was pushed down, the tax system was reformed and subsidies were erased. Developments in the property market were a central component in the banking crisis, as the banks’ credit-granting meant they were highly exposed to the property sector. Property prices rose at an unreasonable rate, regardless of how one measures them. They left the basis for normal pricing, i.e.