samchain/econo-pairs-v1 huggingface dataset:
Given the importance of the bank finance for the non-financial sector, the ECB undertook specific measures targeted at covered bond market, which is an important source of liquidity for banks. To ensure adequate depth and liquidity at secondary markets for government securities and increase the investors’ confidence in 2010 Securities Market Program and later on in 2012 Outright Monetary Transactions were implemented. To support the lending to the private sector a credit easing package was introduced in 2014. To address the risk of prolonged period of low inflation, at the beginning of 2015 the Expanded Asset Purchase Program was adopted. 3 Albania, Bosnia and Herzegovina, Bulgaria, Croatia, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Macedonia, Poland, Romania, Serbia, Slovenia. 2  region. In this analysis we will focus on the financial channel, i.e., on the extent to which eased financial conditions due to the ECB’s unprecedented monetary stimulus has affected the financial conditions in the region. First, we will tackle the question on the synchronization between the changes in ECB rate and policy rates in the region, and subsequently the transmission to banks’ lending rate as an indicator for the financing conditions of the private sector. In this context we will also touch upon the issue of the spread between foreign and domestic interest rates as an important factor that influences the room for monetary policy maneuver of the central banks in the region, especially for economies with some form of managed exchange rate regime.

But, it should be stressed that throughout survey vintages, a rebalancing of the 4  CESEE Bank Lending Survey, European Investment Bank. sources of financing was visible. Given the deleveraging of the international banks present in the region, the intra-group financing which was receding was substituted with local funding. Easy access to retail and corporate deposits was reported as a feature in the second half of 2015, and the first half of 2016 as well. Chart 4: Average annual credit growth Annual credit growth in %  70  average 2005-2008  60  average 2009-2012  average 2013-2016  50 40 30 20  10 0 -10  SLO  SRB  ROM  POL  MKD  LIT  LAT  HUN  EST  CZR  CRO  BUL  BIH  ALB  -20  Source: Central Banks’ internet pages. In light of the rising importance of local funding as a source of financing for the banking systems in the region, and hence as a basis for further credit revival, one important aspect is the impact of low interest rates on the savings in the banking system. The dynamic observance of the deposits rates in the banking system of the region reveals a large downward adjustment of the yield on deposits, both for corporates and for households.
François Villeroy de Galhau: Overcoming the energy crisis - a European perspective (and beyond) Speech by Mr François Villeroy de Galhau, Governor of the Bank of France, at the Paris EUROPLACE Tokyo International Financial Forum 2022, Tokyo, 15 November 2022. *** Ladies and Gentlemen, It is a great pleasure for me to be with you again –physically with you – in Tokyo for this International Financial Forum organised by Paris Europlace. I am honoured to share the closure of this event with my colleague and friend Governor Kuroda. We face together the awful Russian war in Ukraine, and its consequences on energy and economy. I will start with a brief description of the macroeconomic outlook in the euro area, and with our monetary policy normalisation (l). I will then focus on sustainable finance in France, Europe and Japan: it has a key role to play in our ecological transformation, more needed than ever (II). I. Macroeconomic outlook in the euro area  A. Despite recent shocks, growth outlook has shown overall resilience so far Let me start with the macroeconomic situation in the euro area, which has so far shown resilience. In 2021 our economy had strongly recovered from the Covid crisis: growth had reached 5.2 %, and even 6.8 % in France. We Europeans have remarkably overcome the Covid crisis, which hit us early and strongly. We achieved this through enhanced European unity, for instance in purchasing vaccines, and in implementing common budgetary measures to support our recovery (SURE(i) and Next Generation EU programmes).

In short, very rapid and uncontrolled growth in the fringe (i.e. not primary) banking sector came home to roost when the first oil shock hit in 1973, delivering a blow to the economic prosperity enjoyed by the UK since World War II, reducing the value of bank assets and revealing a significant mismatch of borrowings and lending that resulted in a liquidity, and subsequently solvency, crisis. The secondary banks were especially affected, having been able to expand their balance sheets rapidly using 14  wholesale markets , much as Northern Rock did just over thirty years later. The number of affected banks surpassed fifty  15  in total and the Bank coordinated a significant effort – the  so-called ‘Lifeboat’ operation – to assist the troubled institutions, whether through shareholder support, marriages to stronger banks or support directly from the Bank. The most important revelation, however, was that these institutions had been allowed to go effectively unsupervised by the Board of Trade in the first place. Such a circumstance arose due to something seemingly quite simple – the lack of a definition of a “bank” in UK law. Under Schedule 8 of the aforementioned Companies Act 1948, certain firms could be exempted from publishing their accounts in full on the grounds that they were banking companies. On this basis, certain banks – in almost all cases, the well-established ones – were subject to Bank oversight.
Although to date most of the Interim FPC’s deliberations have concerned bank capital adequacy, I expect the FPC’s longer-term focus to be as much on the capital markets and, thus, the policies of the FCA. In a world where banks have been re-regulated, some risk taking will migrate to other parts of the system. It is, therefore, hugely welcome that the Bill currently before Parliament gives the FCA a statutory objective of helping to preserve stability. 9 That is going to be important, for example, to contain any systemic risks stemming from shadow banking, such as money market funds, or from fault lines in the trading infrastructure or disclosure regimes. 10 Sometimes a permanent fix will be needed. The FPC will be able to make recommendations to HMT to move the perimeter of microregulation, and to PRA or FCA to change their rules and policies. But sometimes it will be more a matter of choking off a transient burst of exuberance. Even where market participants become aware of the potential risks, a collective action problem can impede their taking their foot off the accelerator. A telling experience in the run up to the crisis was of Chief Risk Officers on Wall Street talking openly about a dilemma between what they called financial risk and business risk. On the one hand, the Street was taking a lot of financial risk, which could end in tears.

That is supplemented by three operational objectives, including “protecting and enhancing the integrity of the UK financial system” which is in turn defined in the legislation to include “its soundness, stability and resilience”. This is in line with Principle 6 of IOSCO’s objectives and principles for securities regulation: “the Regulator should have or contribute to a process to monitor, mitigate and manage systemic risk, appropriate to its mandate”. 10 See Tucker (2011), “Building resilient financial systems: macroprudential regimes and securities market regulation”, International Council of Securities Associations. 11 This was highlighted by the Bank of England in 2006 Financial Stability Review p. 8: “Many may have believed that the price of certain assets had become too high and the premium for taking risk too low. But there are business risks associated with acting on that view when others are not; it may not only reduce profitability in the short run, but may also risk losing market share or failing to establish a foothold in a rapidly expanding market. These concerns often seem to have outweighed the risks to balance sheets associated with potentially overpriced assets. As a result, in the early part of this year, there appears to have been an extension of risk-taking activities by financial institutions, including some UK banks. “  BIS central bankers’ speeches  7  the system safe and sound has made real progress in recent years, but it is not complete and absolutely must continue with energy.
‘Innovation rate’ defined as R&D expenditure as a proportion of the previous year’s total assets. ‘TFP’ defined as (the exponential of) the log of net sales, minus the log of cost of goods sold (COGS), log of net property, plant and equipment level (PPE) multiplied by their respective coefficients retrieved in the estimation of mark-ups, and minus the estimated measurement error.. ‘TFP distance’ defined as the gap in a firm’s TFP from the most productive firm (in TFP terms) in a given year within the industry (measured at the 1-digit SIC level). Labour productivity defined as sum of operating income (before depreciation, depletion and amortization costs) plus labour expenses (to capture value-added), divided by number of employees (in line with Imrohoroğlu and Tüzel (2014)). To deal with outliers, and similar to De Loecker and Eeckhout (2018) and Díez et al (2018), we trim the top and bottom of 2% of observations for the investment rate, innovation rate, labour productivity and TFP before running regressions.

14  Within that, this rise in mark-ups among foreign relative to domestic sales-focussed firms is largest in the manufacturing and ICT sectors. Taken together, this evidence is consistent with a story of rising mark-ups being concentrated among internationally-operating firms, who perhaps benefit disproportionately from global network economies of scale and scope. These firms tend to occupy the fat and fattening upper tail of the mark-up distribution. These are firms that might legitimately be termed “superstars” (Autor et al (2017)). Given this diagnosis, what impact might the rise in mark-ups have had on the macro-economy? One aspect is what impact increased market power may have had on firms’ incentives to invest and innovate and hence on firms’ productivity. With investment and productivity each having under-performed over recent years, the relationship with market power has been subject to increased academic scrutiny recently (for example, Eggertsson, Robbins and Wold (2018)). The relationship between mark-ups and productivity is vital in understanding their macro-economic effects (Van Reenen (2018)). On the one hand, if highly productive ‘superstar’ firms, benefitting from network economies of scale and scope, have become more dominant, then higher mark-ups could be the side-effect of a positive supply shock in the economy. On the other hand, if mark-ups are the counterpart to increased market power and reduced competitive pressures, that would suggest a negative supply shock. These effects are not mutually exclusive. For example, Aghion et al (2005) develop a model which generates a concave relationship between competition and investment.
At times, we may be more effective by helping to convene a group of market participants to reach consensus on best practices or a common solution than we would be defining or imposing a solution ourselves. Of course, not all problems are amenable to a solution by public support of private initiative, but we should be open to these types of approaches when they are likely to be successful in achieving our objectives. And sixth, we have to be careful that the necessary and constructive attention that has been devoted over the past several years to meeting control and compliance challenges does not detract from the classic safety and soundness requirements of risk management. These should not be competing priorities. The financial costs and reputational damage associated with compliance and control failure can be very large. And the investments in the internal control infrastructure—in audit and corporate governance changes and in controls over financial reporting—are crucial parts of the foundation for a credible risk management framework. But we need to make sure that the demanding and ever evolving challenges of managing credit and market risk receive a degree of attention by senior management and boards that is commensurate with the risks. And this balance needs to be reflected in where we focus our supervisory efforts, as well. These classic prudential issues, those that make a critical difference in reducing the vulnerability of markets to systemic risk, need to be a principal focus of supervisory attention.

And, I’ve proposed a set of solutions based on risk management tools: a focus on organizational objectives, end-to-end management of critical processes, integrated risk management, and a systems approach to control. These all share the common characteristic of being integrative. Resilient components do not necessarily add up to a resilient whole. So, organizational resilience is an enterprise goal that is achieved through coherent and coordinated enterprise solutions. A resilient organization is able to make better plans, decisions, and actions that deliver desired outcomes over a range of conditions. To strengthen resilience, we seek to tame the problematic present and constructively move forward into the hazy future. The tools of risk management can help get us there. 1 National Research Council, 2012, Disaster Resilience: A National Imperative, Washington, DC: The National  Academies Press. 2 Gillian Tett, 2005, The Silo Effect: The Peril of Expertise and the Promise of Breaking Down Barriers, New York, 4/5  BIS central bankers' speeches  NY: Simon and Schuster. 3 Committee of Sponsoring Organizations of the Treadway Commission, 2017, Enterprise Risk Management:  Integrating with Strategy and Performance. 4 Philippa Girling, 2013, “Operational Risk and Convergence” in Operational Risk Management: A Complete  Guide to a Successful Operational Risk Framework. Hoboken, NJ: Wiley. Ramy Farha, Allen Meyer, Evan Sekeris, and Elena Belov, 2018, Non-Financial Risk, Convergence, and Integration, Oliver Wyman. Steve Culp and Chris Thompson, 2016, The Convergence of Operational Risk and Cyber Security. Accenture.
15  In particular, the Federal Reserve states that, under its new strategic framework, when inflation stands persistently below 2% it will attempt to keep inflation moderately above 2% for a certain time.12 With regard to the ECB, in January this year it announced the launch of a review of its monetary policy strategy. This review has been delayed by the emergence of COVID-19 and is expected to extend into next year. Since this review is ongoing we still do not know what its conclusions will be, but I can confirm that this is an open process: both the ECB and the Eurosystem national central banks are performing a large amount of analysis and requesting the opinion of civil society, academic economists and other professional and social groups. One of the key aspects of this review will be the definition of price stability. The current inflation objective, consisting of rates below, but close to, 2%, may be reformulated. On one hand, it may be necessary to clarify the specific level of inflation that is targeted, in order to make it easier for economic agents to understand.

The risk of such a contraction stemmed mainly from two factors: on one hand, the possibility that money markets would deteriorate to the point of compromising banks’ access to them; and, on the other, the possible reluctance of banks to take on fresh risks in the form of loans against a background of enormous economic uncertainty. To address the first of these risks, the ECB launched a series of longer-term refinancing operations (LTROs). These provided banks with “bridge financing” under advantageous conditions until late July, for when a substantial tender I shall now refer to was scheduled. That stabilised funding costs for the banking sector at a juncture, as I stated, of great uncertainty. As to the second risk, namely banks’ reluctance to extend new loans in such a complex economic environment, the ECB already had an instrument to encourage banks to provide credit: the so-called “targeted longer-term refinancing operations” (TLTRO-III). This programme affords banks financing under particularly advantageous conditions, provided they meet certain lending targets to households and firms (excluding, in the former case, lending for house purchases). With the onset of the pandemic, this programme was modified to make it more attractive to banks, enabling them to obtain funding temporarily at an interest rates as low as -1%, under the condition of not reducing their eligible volume of credit. To obtain liquidity in the Eurosystem’s refinancing operations, including TLTRO-III, participating banks must nevertheless pledge collateral in order to protect the Eurosystem from potential bank failures.
Apart from the adverse economic effects, the NBR’s intervention to help the domestic currency appreciate against the CHF to a level similar to that recorded prior to the Swiss National Bank removing the 1.2 EUR/CHF floor would also impact public policy. Such an intervention would result in changing the benchmark currency on the foreign exchange market from EUR to CHF, contradicting not only the economic reality, but also the EU membership legally binding Romania to adopt the single currency at a certain point in time. As for the possibility of the NBR imposing a ban on CHF-denominated loans, such a decision would have entailed the restriction of CHF-denominated capital flows, thus violating one of the fundamental prerequisites of Romania’s accession to the EU: full capital account liberalisation, completed in 2006. Besides, even assuming such a measure had been possible, it would have affected trade with and investment from Switzerland, as well as the financing of CHF hedged borrowers (exporters, as well as employees of companies with Swiss capital, whose incomes are expressed in CHF). The relevant presence of Swiss capital in Romania is pointed out by the direct investment from Switzerland, which totals around EUR 2 billion, as well as by the number of companies with Swiss capital (over 2,000). These companies’ annual turnover is worth about EUR 7 billion, while the number of employees has ranged between 50,000 and 60,000 (nearing the number of CHF borrowers).

As we advance into the second phase of our Financial Sector Masterplan, the policy of gradually deregulating and liberalising the banking system will be complemented with the objectives of bringing increased benefits to the overall economy. While foreign banks will benefit from this process, it becomes equally important that there is reciprocity in the relationship. It is acknowledged that foreign banks have contributed to the development and vibrancy of our financial sector. They have made large capital investments and facilitated transfer of skills and technology to Malaysia. But the foreign banks have in turn benefited and flourished in the stable economic environment and significant economic growth Malaysia has achieved. Therefore, while greater operational flexibility will be accorded to the existing foreign banks so that they can better serve the needs of the growing economy, foreign banks will also need to become more integrated into the domestic economy. This includes ensuring affordable access to banking products and services by all segments of the society and not to focus only on specific locations. Therefore, the potential to establish additional branches will be balanced with the requirement to distribute the branch network to include non-urban areas. While the focus of foreign banks have been for the most part in urban areas, it should be noted that the  BIS Review 10/2005  1  record has shown that domestic banking institutions with large presence in the non-urban areas have been among those institutions that have sustained strong performance.
Michael Gondwe: Developing economic and banking opportunities in Zambia Speech by Dr Michael Gondwe, Governor of the Bank of Zambia, at the official launch of First Capital Bank Zambia Limited and opening of its Head Office, Lusaka, 26 November 2013. *  *  *  The Chairperson, First Capital Bank Zambia Ltd, Mr Bornwell Chiyabi; The Vice Chairperson and members of the Board Her Excellency, the High Commissioner of Kenya to Zambia, Professor Rono His Excellency, the High Commissioner of Malawi to Zambia, Mr Bandawe His Excellency the Assistant Secretary General of COMESA The Chief Executive Officer, First Capital Bank Zambia Ltd, Mr. Lalit Tewari; Management and Staff of First Capital Bank Zambia Ltd; My Senior Colleagues from the Bank of Zambia Distinguished Clients and Invited Guests; Members of the Press; Ladies and Gentlemen. It is an honour and privilege to be amongst you at this important occasion this evening. Firstly, allow me to express my gratitude to the Chief Executive Officer of First Capital Bank Zambia Limited for extending an invitation for me to come and officiate at this landmark event. This evening’s occasion marks the official launch of First Capital Bank (FCB) Zambia Ltd as well as the opening of its new head office. Please allow me to congratulate FCB (Z) Ltd on this important occasion. First Capital Bank Zambia Limited, as some of you may be aware, has emerged from the former International Commercial Bank (ICB).

As I understand, First Capital Bank has plans to increase its foot prints in Zambia and I hope that the bank will open up branches in other districts of BIS central bankers’ speeches  1  Zambia. This will enable it to enhance financial inclusion, which is among the country’s key priorities. Chairperson I have been informed that FCB has initiated the process of acquiring new state of the art banking software, and is in the process of introducing a full range of IT related products like internet banking, mobile banking and visa card. This demonstrates the bank’s strong and longterm commitment to becoming an important player in the development of our financial sector. This is no doubt driven by the confidence FCB has in the Zambian economy. Ladies and gentleman Zambia’s economy has continued to show resilience in the midst of a slowdown in the global economy as a result of the on-going Euro zone debt crisis and the sluggish growth in the United States of America and some leading emerging market countries including the BRICS. Economic performance has been strong with GDP growth in 2012 at 7.3%. Inflation has continued to be in single digits and was 6.9% in October this year. Although the exchange rate of the Kwacha against major international currencies has been under pressure, it has remained relatively stable, while the country has maintained a positive account balance over the last four years.