samchain/econo-pairs-v1 huggingface dataset:
The 2022 Corruption Perception Index published by Transparency International report showed that Malaysia is ranked 61, compared to 51 in 2019. While Malaysia has placed priority on addressing corruption and strengthening governance and integrity in recent times, for example through the National Anti-Corruption plan, it is imperative for all stakeholders to actively play their role in this very important endeavour. Ladies and gentlemen, Integrity holds an even more foundational place within Islamic finance. Upholding high standards of ethical behaviour and personal integrity at all times are not simply actions that guarantee good governance or financial stability. In our shared faith, they are virtuous ends within themselves. Many verses of the Quran and hadiths emphasise the importance of integrity. One such example is in Sahih Al-Bukhari 7138, where the Nabi Muhammad s.a.w. said: "Surely! Every one of you is a guardian and is accountable for his charges". In today's speech, I would like to touch upon two aspects of banking where the integrity of an institution truly comes to the fore. One, corporate governance and workplace culture. Every individual is responsible for their actions, but what parameters has the institution put in place to make it easier to do the right thing? 1/4  BIS - Central bankers' speeches  Two, the institutional role in preserving national integrity through effective and strict measures against money laundering and terrorism financing – more commonly referred to as ML/TF risks. Firstly, governance and culture.

This cooperation has also included active participation in public-private partnership initiatives, including the National Scams Response Centre. As a member of the Financial Action Taskforce or FATF, Malaysia will once again be undergoing a Mutual Evaluations Exercise in 2024 and 2025. For the uninitiated, this is an in-depth assessment of the country's measures to combat ML/TF risks and its compliance with the international standards set by the FATF. This will be the fourth time for us and the last one was done in 2014. It is my hope that the stride made in Malaysia's AML/CFT ecosystem, strong commitment of all institutions towards a highintegrity financial system, and effective cooperation between the industry and public authorities will be reflected in the eventual outcomes of the Evaluation Exercise. In particular, it is paramount for all staff of reporting institutions to maintain high professional standards, adhere to existing confidentiality requirements, and undergo adequate AML/CFT trainings. Ladies and gentlemen, I would like to leave you with a line that is often quoted when speaking about integrity: "Integrity is doing the right thing even when no one is watching". While the quote may have been over-used, it has not dimmed its truth one bit. It is much easier to do the right thing under other watchful eyes, the safety barriers of procedures, or even the instruction of prescriptive rules. But oftentimes, the decisions that will matter most are what we choose to do when nobody, but our conscience is watching.
But it is interesting that there has not been more interest from investment institutions with ostensibly long holding periods, which are largely unlevered and are not exposed to liquidity risk from borrowing short and lending long. What we commonly hear from contacts is that investment managers do not want to be caught out if asset prices fall further before they recover. But no one can seriously believe that they can spot the bottom of the market, and short-term horizons should not weigh heavily in longer-term investment institutions. All of which suggests that there may be structural impediments. Those could include some combination of the reasonable difficulty that some asset managers experience in assessing the quality of securitised assets; and mandates and accounting policies that may have the effect of shortening asset managers’ time horizons. The challenge for your own industry seems to have been slightly different. The managers of some money funds around the world, although I am sure not all of your members, joined in the “search for yield” by going down the credit spectrum and increasing maturity mismatch during the boom in credit markets. As those funds have moved back towards home base, shortening the maturity and increasing the liquidity of their assets, one effect has been a reduction in the net supply of term funding into the international banking system. That has been one of many contributors to the liquidity strains evident in money markets.

But this 1/4  BIS central bankers' speeches  time, technology and its use has permeated into our lives through the ubiquity of smart devices. This coupled with advances in “AIDA”, or Artificial Intelligence and Data Analytics, mean that new technology can transform or create new business models in ways unseen previously. The rise of social networks and the digital ecosystems, enabled by BigTech and FinTech players, have spurred new business collaborations including with conventional financial institutions that cut across economic sectors. Advancements in distributed ledger technology (blockchain) have also opened up new possibilities to disrupt existing market infrastructure. 8 Already, FinTech developments have revolutionised the way financial services can be delivered. Some examples in capital markets include: (a) In fund and wealth management, the rise of robo-advisory services and AI-driven investment management; (b) In equity research, the use of AI to generate analyst reports; and (c) In primary and secondary markets, blockchain-based platforms that can substitute for central trusted parties by providing an alternate reliable protocol for fund-raising, trade execution, settlement and custody. Regulatory Stance to Innovation 9  Let me broadly share MAS’ stance towards innovation in financial services. 10 Financial institutions have always been at the forefront of innovative use of technology. To the extent that new developments in technology and business models bring benefits to the broader economy, allow improvements in business management, and give customers better choices or services, these are to be encouraged and even supported.
During that time, the Riksbank was legally responsible for the exchange rate regime, and the reasons therefore for considering ERM participation were quite simply to prevent the regime of floating exchange rates from constituting a formal obstacle to Swedish participation in monetary union, in the event this was to become a possibility. When the government then decided that there was insufficient popular support for Swedish participation in monetary union, the question of changing the exchange rate regime was dropped. In connection with the Riksbank being made formally independent in 1999, new legislation on exchange rate policy was also introduced. Nowadays, it is the government that decides upon the issue of our exchange rate regime, although the Riksbank determines how it is to be implemented. In other words, it is the government that would decide whether and when the krona should join the exchange rate mechanism ERM2. Following that, the ministry of finance and the Riksbank would decide what rate between the krona and euro we assess to be consistent with a stable development of the economy. There are very good reasons to agree upon a common line of action. This is why we are holding discussions already among toplevel officials about an appropriate line of reasoning, the results produced by different estimation methods, etc. If we do not reach agreement, it is likely to be difficult to hold effective discussions with our European partners.

However, the stability aspect of this must be given attention. The operational risk would increase when a greater number become dependent on one big system. With regard to the Riksbank, the direct effects of participation in monetary union on the work with financial stability would not be particularly large. Even if Sweden were to join monetary union, the Riksbank, under present rules, would be responsible for making decisions on providing emergency liquidity assistance to Swedish institutions. Furthermore, the vulnerability of the banks and the payment system would not change overnight but would continue to be largely national in nature, as long as the European banks and payment systems have not become genuinely integrated. The oversight and management of crises would therefore have to be carried out by national authorities. The big difference is that international cooperation would become even more important. In the long term, as banks and securities markets become increasingly more integrated, new and interesting issues would arise on how best to carry out international supervision and oversight. In this discussion, if Sweden were to join monetary union, our voice would carry greater weight as a member of the ECB Governing Council and in the cooperation of finance ministers. This is also important for our ability to influence how integration in general proceeds and thereby also for the financial sector’s conditions in Sweden. The role of the Riksbank If Sweden were to join monetary union, the Riksbank would become part of a bigger whole, the Eurosystem.
In this hypothetical scenario, the policymaker has something of a tightrope to walk. For an individual bank, cutting risk exposures by reducing lending might at first blush seem to be a step towards restoring capital adequacy. For the system as a whole, however, it would clearly be counterproductive for all banks to delever in that way. The better path, not only for economy but for individual banks as part of the financial system, would be for banks to strengthen their capital structure so that credit supply was not impaired. A second distinction is between the market and the macroprudential policymaker having the same information and views on what ought to be done (Column 1, Figure 1) and their having different information and views. Most interesting are those cases where the market and the FPC are out of synch. Suppose the market spotted first that the system was dangerously under capitalised. Banks’ debt funding costs would rise sharply and would remain elevated until the market saw evidence that either the banks or the authorities were grasping the nettle. A belated but decisive action to raise capital levels would then come as welcome news (Column 2, Row B). Funding costs should fall back, perhaps significantly, and credit conditions could well ease. That would take some of the edge off the downturn. I want to stress that in this particular hypothetical scenario, an increase in capital requirements has the effect of easing credit conditions.

BIS central bankers’ speeches  7  Figure 1 Impact of an increase in capital requirements by the Financial Policy Committee  State of State of business and credit cycle  View of Market on FPC’s assessment of system capital adequacy (1) Agrees and expected FPC action  (A) Boom  Debt spreads broadly unchanged  Debt spreads (B) Bust  broadly unchanged / fall slightly  (3) Behind FPC (but  (4) Shares FPC’s  (2) Ahead of  when FPC acts,  information but  FPC  worries it may not  disagrees that  have done enough)  system lacks capital  Debt spreads  Debt spreads  potentially rise  broadly unchanged  Debt spreads fall  Debt spreads Debt spreads fall  potentially rise,  Debt spreads  significantly  could exacerbate  broadly unchanged  downturn Note: Coloured shading indicates direction of change in overall financing costs, and hence likely impact on credit conditions. Blue (red) denotes a fall (rise) in overall financing costs and hence an easing (tightening) in credit conditions. Alternatively, the FPC might spot the risk to the system ahead of the market. Debt and, consequently, credit spreads might have been low for some time, with some sectors of the economy taking the opportunity to lever up. Having failed to spot the risks early, the FPC moved to require more capital in the system only once the credit cycle had turned.
This relates to the effective functioning of the board – how it draws on different skill-sets amongst directors, how it sets strategies, and how it interacts with senior management to build knowledge and make decisions in the interests of shareholders. Well-functioning boards aimed at sustained performance are in truth work-in-progress in Singapore and elsewhere in Asia – we probably have more distance to cover in this regard than in compliance with rules. Many companies do not have a good mix of experience and skills amongst their directors. While some of the bigger companies may have the necessary resources and can seek outside help, there are a large number of companies that require help along this journey. We should therefore focus our energies not just on formulating sound rules and best practice codes, but on encouraging and helping companies to address practical issues in making their boards effective and high-performing. Corporate governance study commissioned by MAS and SGX This is one of the reasons why MAS and SGX jointly commissioned a study on improving the implementation of corporate governance practices in Singapore. This study was carried out by Associate Professor Mak Yuen Teen of the National University of Singapore’s Business School and the Corporate Governance and Financial Reporting Centre. The study focused on assessing the current state of corporate governance practices in Singapore and proposing practical measures to improve board effectiveness and governance. Details of the study can be found in the report, which MAS and SGX will be publishing on their websites later today.

With this confidence and trust, policyholders will continue to be willing to use insurance as a means of managing their risks and investments, with all the attendant benefits this brings to the wider economy. UK insurers can only be internationally competitive, or invest for the long term, if they are financially sound. Policyholders will only buy innovative products if they are comfortable they are adequately protected. This is why we see the second of the Solvency II review objectives as the foundation on which measures to pursue the other objectives can be built. There are a number of ways in which the prudential regulatory regime seeks to ensure policyholders are protected. Firms have to hold capital to meet at least a 1 in 200 event in the bad times. And they have to hold reserves not only to meet their likely commitments, but to allow the business to be transferred to a third party. Ultimately there is also the backstop of FSCS coverage for many policyholders. And these mechanisms are all linked: if the capital and reserves firms hold are not adequate, the FSCS backstop needs to be used, the residual cost of which is paid for by surviving firms who in turn may pass the cost to their policyholders or shareholders. Now, it’s our view that in the round, the current regime provides about the right amount of protection for policyholders.
Japan, however, has also become an important market for Norwegian fish, and Japanese tourists spend a considerable amount of money in Norway. The previous large trade deficit with Japan turned into a surplus in 2002, even excluding oil. The current strong growth rates in Asia are boosting demand for commodities. This also influences prices for commodities that we produce. Oil prices have risen sharply since 2000. Prices for other products such as paper and aluminium have shown a flatter trend, but have picked up. Salmon prices, which are more heavily influenced by developments in Europe, have risen sharply since spring 2003 following a marked fall in 2002. The impact of increased competition from low-cost countries on the Norwegian economy Imports from China to Norway increased considerably after 2001, reflecting in part China’s membership of the WTO from December 2001. Imports from China will probably increase in the future. This in itself contributes to lower imported inflation. Moreover, inflation in Norway is restrained because the rise in prices for imports from trading partners other than China is also slowing. High economic growth in China may persist for a longer period, providing the possibility of a large market that will also be open to Norwegian firms. The enlargement of the EEA and the EU on 1 May this year will also open up new markets and sources of income for Norwegian firms, and increase the supply of labour. The transition to more open economies in Central and Eastern Europe has already had an impact on Norwegian firms.

In the long run, output is determined by the supply of labour, capital and technology and by the ability to adapt, but in the short and medium term monetary policy can also have an impact on the real economy. The economy grows over time. Output will in some periods lie above trend growth and in others below trend.2 Stabilising output means seeking to maintain actual output near trend. There is one main monetary policy instrument: the interest rate. Interest rates are set with a view to achieving low and stable inflation, while at the same time seeking to avoid substantial variations in output and employment. In recent years, household income has shown solid growth, and household confidence has been high. Corporate earnings, however, have been low, and until recently enterprises have primarily focused on enhancing efficiency. The level of household borrowing is high, while enterprises are reducing debt. Credit developments are thus giving ambiguous signals to our interest-rate setting. The interest rate can be used to reduce credit demand. At present - with low interest rates abroad and a close link between domestic interest rates and the krone - a tighter monetary policy would restrain credit demand primarily because job security would be reduced. A flexible inflation targeting regime reduces the possibility of exposing households to a double shock in the form of higher unemployment and higher interest rates, as was the case at the beginning of the 1990s.
Tharman Shanmugaratnam: Banking – serving people and growing with your clients Remarks by Mr Tharman Shanmugaratnam, Chairman of the Monetary Authority of Singapore, at Citibank’s 200th Anniversary Cocktail Reception, Singapore, 21 August 2012. *  *  *  Mr Vikram Pandit and friends, Thank you for inviting me to this celebration of Citigroup’s 200th anniversary. When we think about the history of economies, it’s sometimes best told through the history of individual firms and institutions. When we think of the history of the global economy too, the tumultuous changes that we’ve been through in the post-war era as well as the last hundred years, let alone 200, it’s again very interestingly told through the story of individual institutions – although few have survived that length of time. I think the history of Citi, in its own way, tells a fascinating story of what happened in the United States and what happened in the global economy. But the exhibits that I was looking at as I walked in say something that is worth reminding ourselves of – that despite all the transformations, all the new technologies that have been brought to bear, the new management methods and regulations, the innovations in finance, banking has still at its core to be about the basics – it still has to be about providing security to ordinary people, providing new standards for global trade, about growing economies. It’s about serving and growing with your clients.

Those are absolute prerequisites for stability in banking. Active, and sometimes intrusive, supervision of banks, and particularly of global banks, has to be at the foundation for stable banking and finance. I don’t think any reconfiguration of the structure of banking and finance is going to get us to an intrinsically safer system, taken as a whole. And we have to remember that this last global crisis, which is still with us in many ways, started not with large universal banks or large global banks, but with narrow or specialised players. Countrywide (the mortgage provider) in the US, Northern Rock in the UK, investment banks like Bear Stearns and Lehman Brothers. It was accentuated through AIG’s Financial Products division, which played a prominent role on the derivative markets. But it was not global banks that sparked off the crisis, although they helped propagate it globally. It bears reminding ourselves of that. BIS central bankers’ speeches  1  No matter how we restructure the system, no matter how we cut down or dice the pieces, banking will involve risk. And without the right culture – whether it’s about an investment bank or commercial bank or a mono-line player – and without the active and intelligent supervision, we’d have the same problems over and over again. The problems that underpinned this global crisis were old-fashioned problems – property booms that were misjudged by banks, regulators and borrowers; and the problem of banks relying too heavily on borrowing short term to invest long-term.
I’m perfectly – I think it makes sense to look at the Dodd-Frank Act, to see which parts are working and which parts are not working so well. I mean, when I sort of think about the Dodd-Frank Act, I think there’s really two things that we’re trying to accomplish here. Number one, we’re trying to make the probability of failure of large complex financial institutions a lot lower than it was before. So that means more capital, more liquidity, better governance, better risk management. And we want to keep all those things. And the second thing we’re trying to do is that if a firm does get into trouble, we can actually allow it to fail without it threatening to take down the rest of the financial system. So that means you need good resolution regimes, and you need a financial system where you don’t have a lot of vulnerabilities. You know, one thing, for example, that we’ve accomplished over the last year is we’ve had money market fund reform. Money market funds were one of the accelerants of the crisis after Lehman Brothers failed. So, fixing the financial system to address some of those structural weaknesses is also important. So I think keeping that part of Dodd-Frank, central clearing of derivatives, I think is 8 / 13  BIS central bankers' speeches  something that makes the financial system more robust. Keeping all those parts I think makes a lot of sense. Volcker Rule?

Maureen O’Hara: Well, I think, I hope you’re right that we’re reaching a new awareness of the fact that some behaviors just can’t be accepted. You know, I don’t care whether they’re legal or not. They’re over any kind of ethical lines. And we shall see, it’s a new world, isn’t it? President Dudley: Yeah. It’s very important that people understand that the idea is not to just perform to the regulation and the legal law. And one of the things we have, because we have a very legalistic system with lots of regulations with banks – people sometimes feel like, “Oh, well, given that, I can do anything within those parameters." Well, the world changes faster than the regulations and law can sort of keep up. And so, using that as your guide in terms of what’s good behavior, permissible behavior, I think is a very bad, bad guide. Maureen O’Hara: Well let me turn to one last question, and then we’ll open it up to all of you. Would repeal of parts of Dodd-Frank, the Volcker Rule, be a good thing for the financial system? Any predictions about what’s going to happen with financial regulation going forward? President Dudley: Well, I think that it’s certainly going to be looked at, and obviously we’ll have to see how it makes its way through the House of Representatives and the U.S. Senate.