samchain/econo-pairs-v1 huggingface dataset:
In other words, it stems from an increased acceptance of paying a certain price over the short term in order to reduce the risk of a particularly unfavourable outcome later on. However, the question remains of what this “something” that can dampen the build-up of imbalances could be. Should we deploy the weapons of the policy rate, of regulations or of a combination of the two? The answer to this question largely depends upon the view taken of the efficiency of the policy rate and regulations respectively as regards dampening excessive credit growth. It also depends upon the consequences arising for inflation and the real economy in various time perspectives if the policy rate or regulation, respectively, are used. Both the policy rate and regulations have their advantages and disadvantages. The policy rate is a blunt instrument in so far as it impacts all lending in the economy, which can be seen in the two interest rate equations for companies and households, respectively. It can require decisionmakers to make difficult choices and is a tough challenge to communicate. It is probably quite difficult to explain that the policy rate is being increased to safeguard stability in inflation and the real economy further ahead, even though everything looks good in a more short-term perspective. This task is not made any easier when policy rate increases impact sectors in which credit growth is not deemed to pose any problem. At the same time, the very bluntness of the policy rate is one of its strengths compared with regulations.

The first agreement on liquidity between the Bank of England and private banks occurred in 1947, and involved a requirement to hold a minimum liquid assets ratio of thirty-two percent (lowered to twenty-eight percent sixteen years later). The regime prevailed until 1971, when the Competition and Credit Controls Act (CCC) introduced a minimum reserve ratio of twelve and a half percent. The CCC had two objectives: first it was intended to strengthen control over monetary policy, by creating a solid money base to underpin it; second, it aimed to unify restrictions on banks to strengthen competition in the industry. The minimum reserve ratio was designed with this aim in mind, and this perhaps took priority over any desire to impose prudential liquidity reserves. While CCC undoubtedly liberalised the UK banking sector and thus supported improvements in competition and efficiency, it led to a fall in very high quality sterling liquid asset holdings of UK banks, as shown in Chart 4. After twice lowering the minimum requirement, the Bank of England finally replaced the reserve ratio regime with the cash ratio deposit regime in 1981, which did not directly require a minimum level of liquid assets. The Sterling Stock Liquidity Regime (SLR) in 1996 focused on holding sufficient liquidity to meet a particular severe cash flow funding stress.
The aim of such rules would be, in a crisis situation, to split off those units of a bank that are important for the functioning of the economy and wind down the rest. This does not mean, however, that this type of approach would question the universal bank model as such. The SNB is aware that rules governing the organisational structure of large financial institutions are not easy to draw up. Legal and operational aspects would therefore need to be analysed with the requisite care and any regulations drawn up in close collaboration with the banks affected. We are convinced that everything needs to be done to implement one of these approaches for facilitating the wind-down of large financial institutions. If significant progress is not achieved within a reasonable time frame, measures that address the size of the banks should also be examined. One way in which the size of a bank can be influenced is through capital regulations. Capital requirements that are dependent upon size reduce a bank’s incentive to inflate its balance sheet without restraint. Measures with a direct impact on the size of banks are also conceivable. A size restriction would of course be a major intervention in an institution’s corporate strategy. Naturally the SNB is aware that there are advantages to size. For this reason, the advantages and disadvantages of such a measure would have to be examined and weighed up very carefully.

In our supervisory processes, we spend quite a bit of resources and time in continuously monitoring individual institutions. By adopting Regtech, we can enhance the overall risk management and compliance quality of banks. And that in turn leads to better management of the overall risk in the financial system. The HKMA’s Regtech initiatives 1/6  BIS central bankers' speeches  10. So given the importance that we attach to promoting Regtech adoption here, what have we done so far? In the past few years, we have been facilitating the collective efforts by the banking industry, the technology community, and other stakeholders in pursuing their Regtech journey. Let me highlight a few initiatives here. 11. One example is that the HKMA is a pioneer in the introduction of Sandbox and Chatroom, and a number of Regtech projects and ideas have benefitted from those arrangements. Over the years, we have seen a surge in the popularity of Regtech in Hong Kong, as shown by the fact that the number of Sandbox and Chatroom cases focusing on Regtech has increased fivefold since we launched those arrangements several years ago. A growing number of Regtech firms are now showing interest in the Hong Kong market, and we have indeed met a wide range of Regtech firms in our Chatroom sessions. 12. We also complemented those efforts by regular publications such as our “Regtech Watch”. That newsletter is a useful channel for us to introduce banks to potential Regtech use cases. 13.
•  The third is the importance of regular vulnerability testing. We launched CBEST, a controlled, bespoke, voluntary cyber security testing framework which aims to bring to bear the best available intelligence on potential threats to test directly a firm’s ability to protect, detect and respond to cyber attacks. 2. Recovery capabilities  But even with improved ex ante resilience, no network is impenetrable. Hence why firms’ recovery capabilities are equally important. We still need firms to work to be able to resume vital services quickly and reliably in the event of operational disruption. We are keen to see firms adapt their approaches to business continuity planning to take account of cyber. One possibility raised in the FSR is seeking more segregation between primary and backup systems. 3. Effective governance  I mentioned earlier it is for firms in the first place to be responsible for their cyber resilience. I’ve also noted that cyber is about people as much as it is about technology. And let me be clear, the responsibility for understanding this risk extends beyond technology specialists; firms’ boards need to view cyber risk as a core strategic issue and be in a position to challenge senior management in all business areas on the adequacy of their arrangements to deliver cyber resilience. Going forward So this is where we’ve got to on cyber. But now it’s clear we need to place cyber on a more permanent footing.

But the operational risk regime in Basel III 1 is designed to address another potential cause of financial failure in firms and to ensure that banks are adequately capitalised against these risks. It does not target the continued availability of services and resilience directly. c)  The third observation is that at the level of the sector our risk appetite has targeted limited disruption in firms that are critical for system functioning. For example FMIs supervised by the Bank as systemically important, set their standard of availability above 99%. And where firms suffer outage we expect them to have business continuity arrangements that allow them to recover immediately or within hours. Firms as a result have established primary and secondary sites, at a suitable  1  This refers to the capital regime only. Additional guidance on operational resilience can be found in the Basel core principles (http://www.bis.org/publ/bcbs195.pdf). BIS central bankers’ speeches  1  distance from each other, with data mirrored between the two. At the sector level as authorities we have concentrated on ensuring that in the event of a significant disruption to one or more firms we can share information and coordinate actions across firms in the UK market to minimise the impact of system stability and to speed full recovery.
The key distinction is that, whereas the speculator takes a view based on the price which he observes in the market and acts upon it, the manipulator uses his resources and the advantage of a dominant market position to try to influence the price - in other words, he is a potential price setter rather than a price taker. Particularly in small markets where relatively small deals may be able to move prices significantly, we need to be alert to this potential problem, which may, if unattended, seriously undermine one's vision of competitive, efficient markets. Information The prices at which derivatives trade contain information which may usefully supplement other market data available to central banks as a means of monitoring expectations and sentiment. Let me give just two examples. First, in the foreign exchange market, whereas the forward rate may provide a point estimate of the expected future rate, data on option prices for different strike prices can provide a probability distribution for the future rate. This additional information, available only as a byproduct of derivatives trading, may be of interest to market analysts, including the monetary authorities. Within the HKMA we have conducted some research into this, which we are in the process of discussing with academics and other technicians. Second, with exchange traded products, where levels of activity are clearly visible, sudden surges or collapses in turnover may hint at shifts in sentiment for one reason or another.

This is perhaps a rather dry topic and I feel sure that there are many more interesting and challenging aspects of derivatives which will be discussed during these two days of seminars related to the Derivatives Expo. 2  Record of discussion of the Exchange Fund Advisory Committee Sub-committee on Currency Board Operations on 5 November 1999, reproduced in HKMA Quarterly Bulletin, February 2000. BIS Review 91/2001  3
Against that background, the view was that, while the US economy might be in for a bumpy ride over the next few months, associated for example with inventory adjustment in the motor industry, the likely outcome for this year as a whole is that the US economy will continue to grow by perhaps 2-3%, and that the overall world economy – helped by steady growth in the Eurozone – would again this year grow probably somewhat above its longer-term average rate. That, certainly, is a slowdown in the recent rate of growth – and a downward revision of earlier expectations of growth for the current year; but it is not a downturn in the sense of contracting activity. On this view, the slowdown in prospect would have relatively benign effects in terms of the longer term sustainability of the global economic expansion; and developments so far have already had positive effects both in terms of their impact on the world oil price, and in terms of their impact on the pattern of exchange rates, notably by reducing the exaggerated weakness of the euro. On that basis the global economic environment should provide a reasonable background for our own economy. We – and our partners in the European Union – would be relatively little affected by the US economic slowdown. The world economy as a whole would certainly be helped by the somewhat softer oil price – though I appreciate there may be mixed views on that up here in Scotland.

Working from home should be simple and everything should function properly even when a senior official is at home looking after children. Staffing therefore has to be arranged with this in mind. We are also having a drive for more women in managerial posts. Last year we started a mentor programme for female administrators with a view to broadening the base for the recruitment of new managers. ·  Besides altering the ways in which we communicate monetary policy in order to reach a wider public, during these years we have run an educational programme for upper secondary teachers and developed an Internet game called Stargold. At present we are working on an idea for a competition in civics between classes in Sweden's upper secondary schools. 2  BIS Review 51/2001  Evaluating all this is not an easy matter, particularly when one is fully engaged in it. I believe, however, that our efforts to make the Riksbank more transparent have worked well. To use the terminology of the BIS report, we have certainly become more "outward-looking". It has been more difficult to break what the same terminology refers to as "upward-looking". It is not so easy to build up an efficient cooperation and sense of responsibility, unencumbered by prestige, throughout our organisation. It is gratifying that among students in our subject, we are the most popular workplace in the public sector. In the league of all workplaces in Sweden, we rose seven pinholes last year to fourteenth place.
I see the Accountants being vital partners in the operationalizing of the 5 major hubs, and in particular, the commercial and knowledge hubs that we are keen to establish in our country. The CAs have expertise in accounting, auditing, taxation, information technology, financial management, banking, planning, financial analysis and project management, among many other skills. The contribution they could make in the new Sri Lanka that is unfolding before us, therefore, is immense. The skills that they possess in finance, planning and business are also varied, and hence they could play a very important role in many spheres of public and private enterprise of our country. I am confident they would respond to that call, and all of you would enhance your role in our country’s economic activities in the future. A finance man as governor? Let me now strike a slightly personal note before I proceed to conclude this address. In order to do so, let me quote from what Exter had to say about the person to be selected as the Governor: “Although the ultimate authority rests in the Monetary Board, the draft law nevertheless recognizes need for a strong chief executive for the Central Bank. Accordingly, the Governor is made the Chairman of the Monetary Board, and is given control of the agenda for its meetings.

That shared vision has been the platform that has helped the two institutions to achieve “goal congruence” in the recent past, and there is also no doubt that the resulting harmonization has been the powerful driving force behind our steady progress. 12  BIS central bankers’ speeches  In the meantime, we must also appreciate that a large segment of our economic activities are carried out by the private sector, to which many of you belong. Your contribution then, has also been a vital factor in maintaining the momentum and thrust of our economy. Therefore, let me acknowledge today that, no amount of harmonization of Monetary and Fiscal policies could ever be a substitute for the commitment and dedication of a vast number of entrepreneurs who take risks, as well as burn the mid-night oil, to deliver value in our economy. A future role for the accountancy profession Where do we go from here? In my view, Sri Lanka has only just begun an exciting and adventurous journey, and we are steadily moving towards a $ 100 billion economy that would be more diversified and more stable. Needless to say, the success of our journey would depend to a great extent on harmonized policies, clarity of communication, quick implementation, and the maintenance of a vibrant momentum on a continuous basis. In that context, I see the accounting profession playing an increasingly significant role.
Muhammad bin Ibrahim: Building trust in the insurance industry Speech by Mr Muhammad bin Ibrahim, Deputy Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Malaysian Insurance & Takaful Industry Distinguished Partner Awards Dinner 2015 “Building Trust in the Insurance Industry”, Kuala Lumpur, 23 October 2015. *  *  *  It brings me great pleasure to be here tonight at the inaugural Malaysian Insurance and Takaful Industry Distinguished Partner Awards Dinner. Since the Central Bank assumed regulatory role of the industry 27 years ago, the insurance and takaful landscape has transformed significantly. The insurance and takaful penetration rate, measured by the number of policies per population, has increased four-fold from 11% in 1988 to 56% today, and the total paid-up capital of direct insurers has grown twelve-fold from RM635 million to RM8 billion over the same period. Today, the industry has emerged much stronger than when we first started the journey together in 1988. We should take pride in our historical track record the various changes that we had made, the difficult but satisfying journey that we embarked on to realise the full potential of the industry. It is indeed a transformational change that enable the industry to be in the strong position they are now. But at the same time we should not believe that the same thinking and strategy that drove yesterday’s solutions will be as effective tomorrow.

With an average daily turnover exceeding USD22 billion and over 90 participating banks (including 18 that have a significant presence in Thailand), our USD RTGS system in Hong Kong provides ample USD liquidity and easily accessible correspondent banking service to Thai banks for the PvP service. This should help them develop a wider range of banking services and financial products in Thailand. At our end, banks in Hong Kong will find new correspondent banking opportunities through serving Thai banks in settling their USD FX transactions in Hong Kong. I am sure this new relationship will create opportunities for commercial cooperation on other fronts. BIS central bankers’ speeches  1  6. Third, the link will also help banks comply with supervisory requirements relating to the management of FX risk in a cost-effective manner. In February 2013, the Basel Committee on Banking Supervision issued an updated guidance on management of FX risk, which recommends that banks should reduce principal risk as much as practicable by settling FX transactions through the use of financial market infrastructure that provides PvP settlement. This recommended best practice is being implemented by bank supervisors on a global basis. The decision of BOT to implement the PvP link will certainly facilitate banks and the payment and settlement systems in Thailand to meet these recommended standards in good time. 7. While these are all good reasons to introduce the PvP link, its success will depend on the commitment and dedication of all parties concerned.
In parallel, this process should be treated at its roots, to establish a transparent and stable mechanism that addresses factors, which contribute to the increase of public sector liabilities toward private companies, and avoids their increase in the future. Furthermore, the Bank of Albania will amend the regulatory framework to urge banks to support borrowers’ request for credit restructuring, from the moment the credit is considered as good. If the banks realise this in an effective manner, they will have a lower cost as regards requirements for credit risk provisioning. This element would enable banks to address more prudently and proactively their best clients, who may be showing their first signs of credit repayment problems due to factors that are beyond their control. As an element to keep this action in check, the regulatory framework will envisage that this loan stay temporarily under this category (or in the substandard category), and will immediately fall in a lower category, if the loan quality deteriorates after restructuring. After broad consultations with the banks, the Bank of Albania has drafted the relevant instructions that will guide them in the debt restructuring process. BIS central bankers’ speeches  5  Similarly, the Bank of Albania finds that a part of the non-performing loans, mainly the loss loans, remain in the balance sheets of the banks owing to different interpretation by the banking industry and the tax authorities about the commencement and completion of the legal proceedings against a debtor.

In the view of this process, we stand ready to adapt them to the economic and financial developments, or support them with other measures. The stability of the financial system shall be at the foundation of each action of the Bank of Albania in this regard. Finally, I would like to remind all the representatives of the private sector, whether in production or financial industry, that under the effects and impact of the crisis, the public authorities, lawmakers, fiscal and monetary authorities, have made important changes in terms of philosophy, objectives and decision making, far from traditional considerations. These temporary changes aim at mitigating the crisis effects, stabilising the economy, consumption and private investment. The package I introduced today is a good example to illustrate this change. It is necessary, therefore, for the private sector to adopt such a temporary adjustment. Ms. Lagarde, Managing Director of the International Monetary Fund, appealed that in the current situation, the goal of the private sector cannot be only profit; it must also be to add value, create jobs, develop the new ideas that drive an economy forward and provide stability. Boosted employment and higher income from employment means more consumption and investments, higher consumer demand for goods, services and lending instruments. The private and financial sector should be accountable to the real economy: a private sector that supports employees and consumers, and a financial sector that adds values instead of destroying them.