samchain/econo-pairs-v1 huggingface dataset:
There is a residual question about how much of that activity should go via exchanges or via other trading platforms. That’s something which I doubt will be completely resolved this year. I think it will remain part of the G20 and the FSB agenda going into next year. But it is a very important part. Another key element of changing capital markets is much greater transparency around, and much reduced reliance on, credit rating agency ratings. One of the problems in global capital markets has been that too many investors and banks have given up on reaching their own view on borrowers and on instruments, but have effectively subordinated their own judgment to the judgment of credit rating agencies. The FSB is sponsoring and leading work in order to reduce the extent to which credit rating agency ratings are inscribed into, or embedded in the regulatory fabric of our capital markets. 6. Incentives  The sixth thing is incentives. The issue that gets most attention here is compensation or pay, on which the FSB issued a code. The essence of that is that more pay should be deferred. I would add that perhaps part of deferred compensation should be in the form of a debt contract, so that the managers and workers in large firms eventually become creditors of the firm and so they themselves have the same risks as other debt holders. That works only if we can develop resolution regimes leaving debt holders taking risks in our largest firms.

But no one acted to make the financial system more resilient to those vulnerabilities. This was not just an intellectual failure, as is widely discussed and recognized now. It was also partly a failure of machinery. The FSB has been encouraging new machinery to survey and head off risks. The FSB itself has created a vulnerabilities group. It is probably the least prominent part of the Financial Stability Board’s effort to date, but it could have enduring significance over the years and decades. It is paralleled in various regions. Europe is setting up a Systemic Risk Board, which will be supported by the ECB but involve all of the EU. The USA is setting up a Systemic Oversight Council; and in the UK, the government is establishing a macroprudential Financial Policy Committee in the Bank of England. Maybe something is needed in Asia, too. Martin [Wolf] talked about complacency; for the machinery I have described to make any difference, people will have to stick to it year in and year out. 2. Supervision of individual firms  One of the things that should not be neglected is that the severity of this crisis was as great as it was partly because a large handful of individual massive firms failed due to poor management and weak balance sheets. Part of the solution lies, therefore, in much better microprudential supervision and regulation of individual firms. The Basel Committee has had Core Principles for Effective Banking Supervision for some considerable time now.
Taking a longer sweep, over the past 35 years cross border asset holdings having risen more than six-fold in terms of world GDP (Chart 4). Financial innovation has delivered considerable benefits. New products have improved the ability to hedge and share risks and to tailor financial products more precisely to user demand. That has enabled financial intermediaries and users of financial services to manage financial risks more effectively, and has lowered the costs of financial intermediation. And innovation and capital market integration have facilitated the wider dispersal of risks, which may have increased the resilience of the financial system to weather small to medium-sized shocks. Innovation has also delivered new challenges and vulnerabilities. Dependence on capital markets and on sustained market liquidity has increased, as banks and other intermediaries place greater reliance on their ability to “originate and distribute” loans and other financial products, and to manage their risk positions dynamically as economic and financial conditions alter. In turn that places additional pressure on the robustness of financial market infrastructure to handle large changes in trading volumes and to cope with periods of strain. And the greater integration of capital markets means that if a major problem does arise it is more likely to spread quickly across borders. So as highlighted by a number of academics and authorities, 1 the flip side to increased resilience of the financial system to small and medium-sized shocks may be a greater vulnerability to less frequent but potentially larger financial crises.

Benign economic and financial conditions in recent years have kept credit losses at low levels. Combined with buoyant returns from capital market activity, the profitability of major financial institutions has been strong. And capital levels are high. But as highlighted in Financial Stability Reports by the Bank of England and others, this benign environment has encouraged an increase in risk-taking and a “search for yield” which has lowered the compensation for bearing credit risk and market risk to very low levels. The vulnerability of the system as a whole to an abrupt change in conditions has consequently increased. Against this background, I would like to focus my comments today on some of the implications for the management and reduction of risks to the financial system as a whole. More specifically, how can the public policy goal of promoting systemic financial stability be best achieved? I will not provide a fully comprehensive answer to this question but will touch briefly on four aspects; improving the assessment of vulnerabilities that might threaten stability; developing appropriate buffers for capital  1  Financial System Risks in the UK – Issues and www.bankofengland.co.uk/publications/speeches/2006/speech280.pdf  BIS Review 77/2007  Challenges  (John  Gieve)  (July  2006)  1  and liquidity within the financial system that take due account of the changing nature of risks; strengthening the core market infrastructure; and lowering legal uncertainty.
In this case formalism is based on task performance and makes the control structures become dormant or inhibits their positive progress. So it is crucial that the law itself and regulations be as clear and implementable as possible in order to establish confidentiality and facilities in their implementation process. Passing in the definition of the risk profile of the client, is the only way that would permit the compliance with the spirit of the law. This approach is based on a sound “know your client” policy of the bank, which should be a standard requirement nowadays. This approach has several advantages, where one could mention improved capabilities on tightening the system to prevent or detect cases of ML. Furthermore, it allows better distribution and focus of financial and human resources, resulting in a lowering of compliance costs. At the same time, it allows those institutions responsible for implementing the law and analysing the information, to focus on the full investigation of those transactions that represent higher risk of being ML. Another delicate issue that I would to stress on in my speech is keeping and protecting the confidentiality on giving and managing the information on suspicious transactions. Our practice has shown that problems with this issue are complex. We have had cases of confidential information being public in the press, the next day they were filed.

For example, there is currently substantial agreement, both among academics and monetary authorities, on the need to provide central banks with sufficient formal and effective institutional independence, the superiority of interest-rate operational targets over quantitative instruments, and the pursuit of low inflation as the main objective for monetary policy. Both trends - towards deeper and more integrated financial markets, at one end, and towards monetary policies clearly determined to deliver price stability, at the other - are important factors behind the sound macroeconomic performance recorded practically worldwide over the last decade. Notwithstanding this positive view on the recent past, central banks must deploy their best efforts improving their monetary policy and regulatory and supervisory arrangements - to preserve and consolidate the attainments I mentioned, since various significant risks and challenges lie ahead. As stressed by Frederic Mishkin, the final success of the processes of financial liberalisation and globalisation in developing economies hinges crucially on the ability of both policymakers and the private sector to properly respond to a rapidly changing environment. No doubt, the spirit of this proposition applies likewise to developed countries. BIS Review 53/2006  1  An increasingly liberalised and globalised financial system necessitates a reconsideration of some key inputs in our current monetary strategies. The greater relevance of markets and their evolving nature requires an ongoing assessment of the different monetary policy transmission mechanisms. This area, while critical to successful monetary policy decision-making, still remains shrouded in considerable uncertainty.
100 and 500 billion, accounting for a share of 23 per cent. The balance 23 banks individually hold assets less than Rs. 100 billion and account for only 11 per cent. 4  BIS central bankers’ speeches  The non-banking sector is highly fragmented and constitutes 58 NBFIs, of which 48 are Licensed Finance Companies while the balance 10 are Specialised Leasing Companies. The total assets of the NBFI sector amount to Rs. 750 billion. Similar to the structure of the banking sector, 13 large NBFIs, each holding assets over Rs. 20 billion, account for 74 per cent of the NBFIs market share. Meanwhile 13 per cent of the market share is accounted for by 8 NBFIs holding assets between Rs. 8 and 20 billion. The remaining 37 small companies, each holding assets less than Rs. 8 billion, account for only 13 per cent of the NBFI sector. Since the fragmented financial system is highly vulnerable to external shocks, consolidation would help to build a strong and stable financial system. Reason 5: Repositioning the financial sector for delivering a cost-effective service Ladies and gentlemen, as Sri Lanka is moving towards a higher growth trajectory, we will need a more focused financial sector with a higher contribution, particularly from the banking and non-banking sectors. Intermediation by the financial sector in a more productive manner is crucial for achieving a balanced and inclusive growth in the country. Recently, there was an interesting article in The Economist Magazine of 12 April 2014, captioned “The Slumps that Shaped Modern Finance”.

The primary responsibility of understanding the risks run by the bank and ensuring that such risks are appropriately controlled and are within the risk parameters of the Bank, i.e. its risk appetite, is vested with the Board of Directors. It is now a widely accepted principle of good corporate governance that bank management understands new banking products and businesses of the Bank. Without proper understanding of the risks associated with such new products the management should not give their assent to the introduction of such products. It is the responsibility, therefore, of the Board of Directors to set the parameters for risk taking beyond which banking business should not be permitted. What then are the essential pre-requisites for good and effective risk management? Timely and reliable information is the foundation upon which good risk management is built. Lots of questions come to my mind here - do those responsible for credit decisions have a knowledge of the industry they are lending to? Why do banks depend so much on collateral when we all know it is the last resort? This is where information plays an important part. If you do not have knowledge of the industry or sector to which you are lending, your credit decision is seriously flawed and sooner or later will translate itself into NPA. Why do we have high levels of NPA? Is the information necessary for evaluation of creditworthiness of a borrower available to the banks?
Although the Riksbank was able to phase out its extraordinary measures relatively quickly, compared with other countries, the Riksbank’s balance sheet has for various reasons changed since before the crisis. So let us go through why the balance sheet looks the way it does. 1  The concept “monetary policy liabilities” is used as a generic term for the items ‘liabilities to credit institutions in Sweden related to monetary policy operations denominated in Swedish kronor” and “debt certificates issued”. 2  BIS central bankers’ speeches  How has the Riksbank’s balance sheet developed over the past decade? Let us examine (a simplified version of) the Riksbank’s balance sheet from the year-end 2004. Ten years ago, the balance sheet total was SEK 183 billion. The asset side was dominated by the gold and foreign currency reserves, which amounted to SEK 166 billion. In addition, we had a monetary policy claim on the Swedish banks of SEK 17 billion.2 At that time the Riksbank lent money to the banking system and this was done through the monetary policy repo transaction (therefore the name repo rate). The assets are largely funded through the Riksbank over the year issuing banknotes and coins to a value of SEK 109 billion. The bank’s equity amounted to SEK 65 billion. The small liability to the IMF is a result of Sweden’s membership of the International Monetary Fund. I do not intend so say so much about this item now. Let us now compare this with how the balance sheet looks today.

This crosscountry financial fragmentation hindered common monetary policy transmission to the whole of the euro area, and even posed a threat of a repeat of the 2012 sovereign debt crisis. In this setting, in March the ECB announced the launch of a new financial asset purchase programme (PEPP) which grants it the necessary flexibility to be able to concentrate its purchases at certain moments in time or on government bonds issued in certain jurisdictions, with a view to preventing fragmentation in monetary policy transmission. The volume of purchases initially announced under the PEPP was € billion for the whole of 2020. In June the term was extended up to at least June 2021, and the volume by a further € billion, making for a total of € trillion. Today we can safely say that the PEPP has been clearly successful in curbing financial market deterioration in all euro area countries. This is particularly visible in sovereign yields, which are now close to their pre-crisis levels, but it may also be perceived in other market segments such as corporate issuance. This decline in the cost of sovereign debt has amplified the room for manoeuvre of the fiscal authorities in all euro area countries, enabling them to take unprecedented measures to sustain the income of households and firms.
Titles of the boxes are shown on the slide. I strongly recommend that you read these boxes, which will be published on our web-site shortly. Now, I would like to convey the main messages of the report. Firstly, I will touch upon the global economy and then move on to the monetary policy. The last quarter of 2012 was marked by an improvement in the risk appetite (Chart 1). Concrete steps taken towards the resolution of the Euro area problems as well as the favorable news regarding the US and Chinese economies were the leading developments that fed into the risk sentiment. On the other hand, quantitative easing policies were sustained amid the persisting sluggish growth outlook in advanced economies. Continued monetary easing at a global scale accompanied by increased risk appetite led to an acceleration in portfolio flows towards emerging economies (Chart 2). We are of the opinion that all these developments once again highlighted the importance of a flexible monetary policy framework. Chart 1. Global Risk Appetite  Chart 2. Portfolio Flows to Emerging Economies (Billion USD)  Source: Credit Suisse, Bloomberg. Source: CBRT. BIS central bankers’ speeches  1  1. Monetary policy and monetary conditions  In this period of extraordinary global circumstances, the policy framework designed by the CBRT plays a great role in confining the adverse impacts of global shocks in Turkey. Particularly the year 2012 was marked by the fruitful implementation of our policy mix.

Thus, complaints are heard that some measures ignore the sociocultural context in which the institutional changes are to be effected, thereby constituting an illegitimate transplantation of institutions into developing countries. Issue is made of the use  6  BIS Review 109/2007  of governance indicators as conditionality for assistance, and the onset of selectivity, rather than an attempt at providing more meaningful support for relevant institutional development. Countries that accept the governance framework programme proposed by the donor community receive funding and support, while those more sceptical are more or less left out in the cold. Thus arises the questionable extent of linkage between governance, development and poverty alleviation. The fact that most African countries are so aid dependent compels acceptance of the governance conditionalities. Thus they are forced into a situation, which divests them of control of their economies, adopting policies that may not conduce to their long-term development, and making them easy prey for the interests of global capitalisation. Yet the need for governance reforms in most African countries cannot be denied. Inadequacies in the institutional set-up undoubtedly need attention and correction to bring about efficiency and competence in the management of the state, and hence the ability to provide citizens with the services they require for their well being. The plight of the developing countries compels resort to external assistance. Some economists, prominent among them Jeffrey Sachs, have proposed the need for a “big push” to help alleviate their problems.
Pension funds – reacting with moderation and flexibility Ladies and gentlemen, the pension funds have not been idle in the last few years with regard to the challenges mentioned. As pension fund managers, you have shown moderation and great flexibility in initiating various measures to bring your pension funds’ income and expenditure into equilibrium over the long term as well. On the investment side, the exposure to fixed-income instruments has been reduced – given the persistently low interest rates – in favour of equities and real estate (cf. chart 4). Furthermore, the pension funds have again become more active abroad, and are keeping their liquid assets to a minimum. Indeed, liquidity as a share of total investment assets is currently at a historic low (cf. chart 5). You have also had to take action on the benefits side in order to balance income and expenditure over the longer term. These cuts are painful and have been directly reflected in people’s insurance certificates. One example is the sharp reduction in the conversion rate for non-mandatory cover. 8 Moreover, the technical interest rate 9 has been lowered by 40% in the last ten years. This took account of the probability that income from the ‘third contributor’ would also be greatly limited in future.

Page 8/8  Challenges confronting the pension system – options and limitations of monetary policy Thomas J. Jordan Chairman of the Governing Board Swiss National Bank PK-Netz conference, Berne, 31 October 2019  Chart 1  31.10.2019  Challenges confronting the pension system – options and limitations of monetary policy | Thomas J. Jordan | © Swiss National Bank  Chart 2  31.10.2019  Challenges confronting the pension system – options and limitations of monetary policy | Thomas J. Jordan | © Swiss National Bank  Chart 3  31.10.2019  Challenges confronting the pension system – options and limitations of monetary policy | Thomas J. Jordan | © Swiss National Bank  Chart 4 and 5  31.10.2019  Challenges confronting the pension system – options and limitations of monetary policy | Thomas J. Jordan | © Swiss National Bank  Chart 6  31.10.2019  Challenges confronting the pension system – options and limitations of monetary policy | Thomas J. Jordan | © Swiss National Bank
Thomas J. Jordan Chairman of the Governing Board Swiss National Bank University of Basel, Faculty of Business and Economics Basel, 23 November 2017  EQUATION 1 Current account balance = Trade account balance + Net labour and investment income + Net current transfers EQUATION 2 Current account balance = Savings of an economy – Domestic investments = Financial account balance EQUATION 3 Change in net international investment position = Current account balance + Other influencing factors = Financial account balance + Other influencing factors  2  23 November 2017  University of Basel, Faculty of Business and Economics | Thomas J. Jordan | © Swiss National Bank  3  23 November 2017  University of Basel, Faculty of Business and Economics | Thomas J. Jordan | © Swiss National Bank  4  23 November 2017  University of Basel, Faculty of Business and Economics | Thomas J. Jordan | © Swiss National Bank  5  23 November 2017  University of Basel, Faculty of Business and Economics | Thomas J. Jordan | © Swiss National Bank  6  23 November 2017  University of Basel, Faculty of Business and Economics | Thomas J. Jordan | © Swiss National Bank  7  23 November 2017  University of Basel, Faculty of Business and Economics | Thomas J. Jordan | © Swiss National Bank  8  23 November 2017  University of Basel, Faculty of Business and Economics | Thomas J. Jordan | © Swiss National Bank  9  23 November 2017  University of Basel, Faculty of Business and Economics | Thomas J. Jordan | © Swiss National Bank  10  23 November 2017  University of Basel, Faculty of Business and Economics | Thomas J. Jordan | © Swiss National Bank  11  23 November 2017  University of Basel, Faculty of Business and Economics | Thomas J. Jordan | © Swiss National Bank

All reporting institutions are invited to provide comments and views on the draft which may be organized through relevant licencing authorities, self-regulatory bodies, industry associations or directly to Bank Negara Malaysia; and 2. second, I would also like to take this opportunity to remind all reporting institutions, that Bank Negara Malaysia is increasing its supervisory and enforcement of AML/CFT compliance, in which we intend to pursue more deterrent action including taking appropriate enforcement actions under the AMLA, for any identified non-compliances, beginning 2020. As such we urge all reporting institutions present today to engage and discourse any compliance issues with the wide ranging of experts that we have lined up for this conference. With that, I wish everyone a fruitful discussion ahead and Selamat Menyambut Hari Kemerdekaan. 3/3  BIS central bankers' speeches