Not only would this more effectively capture the risks that banks are taking, but it also would create incentives to move the trading and settlement of such instruments more rapidly to central clearing parties (CCPs) and to exchanges. The greater use of CCPs and exchanges should have several benefits, including reduction of risk through the multilateral netting of exposures and improved transparency with respect to the structure and pricing for such instruments. 4  BIS Review 125/2009  Capital conservation More explicit supervisory standards regarding capital conservation would also be an important element of an efficient capital regime. During the crisis, some banks continued to pay out dividends even though their condition and market valuation metrics had sharply deteriorated. Banks did this to try to convince investors that their bank was “sound.” But by depleting capital, these actions made banks and the financial system weaker. To mitigate these dynamics, regulators could require the reduction and possibly the cessation of dividend payments and share buybacks during adverse market environments when particular triggers were breached. For example, limits on dividend payments and share repurchases as a share of earnings could be mandated to occur when common equity ratios fell below certain levels (recognizing that credit and mark-to-market losses deplete the capital structure from below) or when market-based measures hit certain trigger values. Taking away the discretion of banks to deplete capital would strengthen the banks’ ability to withstand adverse environments. In principle, such constraints could conceivably be extended to compensation and bonus payments.

Muhammad bin Ibrahim: Mobile payment – the next wave Keynote address by Mr Muhammad bin Ibrahim, Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Payment System Forum & Exhibition 2017 "Mobile Payment: The Next Wave", Kuala Lumpur, 8 December 2017. * * * Welcome to the Payment System Forum & Exhibition 2017. This year’s theme ‘Mobile Payment: The Next Wave’ is the continuation of our country’s e-payment transformation that started seven years ago. In 2011, we launched the 10-year e-payment roadmap in the Financial Sector Blueprint 2011–2020. Various reform measures were instituted to remove pricing distortions, instill market incentives and induce competition to reduce costs in our effort to create a conducive environment to accelerate migration to e-payments. These measures have been effective in reducing Malaysia’s usage of cheques and fostering the adoption of e-payments. The total cheque volume has declined by 42% from 205 million cheques in 2011 to an estimated 120 million cheques in 2017. Electronic fund transfers have increased from 66 million transactions in 2011 to an estimated 329 million transactions in 2017, surpassing the number of cheques issued by almost three times. At the current rate of decline, we are likely to achieve the Financial Sector Blueprint target of reducing cheque usage to 100 million in the year 2019, one year ahead of schedule. Encouraging progress has also been made in the expansion of the point-of-sale (POS) terminal network.