samchain/econo-pairs-v1 huggingface dataset:
Another factor weighing on the resilience of the financial sector is a downturn in the real estate markets, which could be amplified by higher borrowing costs and a rise in unemployment. At the same time, euro area banks have strong capital and liquidity positions, which mitigate these financial stability risks. Macroprudential policy remains the first line of defence against the build-up of financial vulnerabilities. Conclusion  3/10  BIS - Central bankers' speeches  Inflation has been coming down but is projected to remain too high for too long. The Governing Council therefore today decided to raise the three key ECB interest rates by 25 basis points, in view of our determination to ensure that inflation returns to our two per cent medium-term target in a timely manner. Our future decisions will ensure that the key ECB interest rates will be brought to levels sufficiently restrictive to achieve a timely return of inflation to our two per cent mediumterm target and will be kept at those levels for as long as necessary. We will continue to follow a data-dependent approach to determining the appropriate level and duration of restriction. In particular, our interest rate decisions will continue to be based on our assessment of the inflation outlook in light of the incoming economic and financial data, the dynamics of underlying inflation, and the strength of monetary policy transmission.

We have received more than 30 applications from financial and research institutions. We have now put out five calls for applied research proposals: in econometrics and data science, back-testing methodologies, quantum computing for the financial sector, and explainable AI. Last year, MAS and the industry also began collaborating with MIT Media Lab to do serious FinTech R&D. MAS, industry professionals, and MIT researchers have come together towards developing prototypes that look into applications of AI and distributed ledger technology in the financial sector. They include use cases in smart contracts, trade finance, and central bank digital currencies. And earlier this year, the Intellectual Property Office of Singapore established a FinTech Fast Track initiative for patents. 7/9  BIS central bankers' speeches  Under the Fast Track, FinTech patents can be granted in as quickly as six months, compared to the industry convention which can be up to two years. Once patented in Singapore, applicants can leverage on our global patent highways to expedite the registration of their patents in more than 30 overseas markets. Platforms for Innovation The final piece in FinTech ecosystem - platforms for innovation. Innovation does not occur in isolation. We need platforms to connect people and ideas; problems and solutions; and foster collaboration. One such platform we are excited about is AFIN – the ASEAN Financial Innovation Network. Let’s begin with the problem statement. There are about 1.7 billion adults globally who are unbanked.
19 20 21  7  All speeches are available online at www.bankofengland.co.uk/news/speeches  7  also act as the unique identifier for a digital ID, which could help the two-step verification process required for a secure system. The Bank will submit a formal response on how to develop an open platform for competitive SME finance to the Smart Data Review referenced by the Chancellor this evening. Strengthen resilience in the face of new risks The City of London has maintained its pre-eminence by innovating. This was as true in the First Industrial Revolution when finance oiled the pistons of the steam engines, as it is today at the dawn of the Fourth Industrial Revolution, with the advent of cloud computing and the robosapien fund manager. Today the key competitive advantage in financial services is how firms – and supervisors—collect, store and analyse the explosion of data. Just as the steam engine transformed manufacturing, AI, ML and cloudbased technologies are transforming services. Accordingly, the second focus of the Bank’s initial response is how new general purpose technologies, like the Cloud and AI, can be used to strengthen the resilience of the system. Embracing these technologies could herald leaner, faster and more tailored financial services.

SMEs are the engine room of our economy, generating around 60% of all private sector employment and accounting for over half of all private business turnover.16 And yet SMEs face a £ funding gap.17 Almost half of all SMEs don’t plan to use external finance, citing the hassle or time associated with applying. Of those that have approached their bank, two fifths have been rejected.18 Part of the problem is that the assets that SMEs are seeking to borrow against are increasingly intangible – the value of a brand or user base – rather than physical assets, like building or machinery. SMEs that have not borrowed lack the historic data required for credit scoring. And legal requirements to prevent money 15  See: https://libra.org/en-US/. Federation of Small Business: https://www.fsb.org.uk/media-centre/small-business-statistics. NAO report ‘improving access to finance for SMEs (Nov 2013). 18 Report by British Business Bank: Small Business Finance Markets (2019). 16 17  6  All speeches are available online at www.bankofengland.co.uk/news/speeches  6  laundering and “Know Your Customer” make the process especially burdensome for a small business with limited resources. This should not be the case in a data-rich world. Lenders should be able to access a broader set of information on which to base credit decisions. Already, search and social media data are supplementing traditional metrics to unlock finance for smaller enterprises whose assets are increasingly intangible.
Rather, responsibility for risk should not be parsed so finely that employees forget the purpose of managing risk in the first place. Understanding the client I promised at the outset that I would talk about the role of lawyers in risk management. First and foremost, lawyers must advise on the law. A colleague of mine likes to say that lawyers must always remember the reason why they are in the room—to advise on the law. To do so, of course, lawyers must know what the law says. 4/7  BIS central bankers' speeches  But that advice is most effective if it is formulated with an understanding of the client’s objectives and challenges, and in light of the broader business context or market in which the client operates. So, when I speak with my colleagues about the New York Fed’s risk, I try to think first, but not only, about legal risk. The Federal Reserve System exists because the public trusts it to serve the national interest. So, I also consider how decisions will affect the public’s trust, and how the New York Fed can best demonstrate that it is worthy of that trust. Managing legal risk is one aspect of trustworthiness, and it is my specialty. But, as an officer of the New York Fed, I have a responsibility to think more broadly about its good name.

I mentioned one example earlier. A borrower may not repay a loan. Prudent lending standards—like securing good collateral and identifying credit-worthy borrowers—can help mitigate that risk. Here is another example. A depositor may use a bank account to hold, transfer, or obscure the proceeds of a crime. This is more difficult to determine, especially when deposits are received from half way around the world. Third-party service providers and customers are examples of risks from outside the bank that are unavoidable in the ordinary course of business. These third-party risks are not purely hypothetical. They featured in recent cases of attacks on the global correspondent banking network. My colleague Richard Dzina runs Fedwire®, the payments system that I mentioned earlier. Here is how he described some of the risk that he faces: Historically, and understandably, market infrastructures have operated on the presumption that endpoint security is principally the responsibility of the endpoint, and infrastructure security is principally the responsibility of the operator. Increasingly, reflecting the elevated cyber threat landscape, this distinction is not so clear, especially as endpoint security breaches can potentially have implications for public confidence in the network as a whole, even in circumstances when the operator’s infrastructure, applications, and security perimeter have not been compromised.3 3/7  BIS central bankers' speeches  I also worry that some risk management practices can themselves create risk. Advances in technology have enabled more sophisticated economic modeling, on which many financial institutions rely to assess and manage their risk.
Ladies and Gentlemen, For more than two decades, our efforts have been directed to put in place the pre-requisites for the development of an effective and competitive Islamic financial system. With the strategic components and domestic financial infrastructure in place, steps have now been taken to liberalise our domestic Islamic financial system - this has aimed to strengthen further our international financial and economic linkages. The liberalisation is evident on several fronts. This has diversified the players in our financial system with the issue of new licences to foreign players and the increase in the allowable foreign equity participation up to 49% in both Islamic banking and takaful industry. This initiative has also created a more competitive environment, thereby driving further progress in the development of the Islamic financial system. In addition, it has promoted innovation, increasing the range of products and services being offered. Efforts to develop the domestic bond market have been intensified to diversify the structure of the Islamic financial system. This has allowed greater flexibility by investors in the management of their funds while the ability of foreign corporations to raise ringgit-denominated papers in our domestic bond market has contributed towards enhancing its depth and breadth. With these developments, this has positioned Malaysia to evolve as an international financial centre for Islamic finance. In this regard, Islamic financial institutions have a significant role to play. The investment in research and development would strengthen the capability for greater innovation by Islamic financial institutions.

Zeti Akhtar Aziz: Launch of AmIslamic Bank Berhad Speech by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia, at the Official Launch of AmIslamic Bank Berhad, Kuala Lumpur, 18 May 2006. *  *  *  It is my pleasure to be here this morning on the occasion of the launch of AmIslamic Bank Berhad. This strategic move to establish the Islamic banking subsidiary that will operate under the more universal Islamic Banking Act will increase further the potential avenues for business expansion. It will also increase the potential to benefit from the rapid growth of Islamic banking and finance both in the domestic and international environment. Ladies and Gentlemen, On the domestic front, all sectors within the Islamic financial services industry, which includes Islamic banking, takaful and the capital and money markets, continue to register strong performance. To date, the Islamic banking assets amount to RM113.5 billion and the takaful assets stand at RM5.9 billion. The amount of approved Islamic bonds in 2005 exceed RM40 billion, while the Islamic money market has recorded sizeable monthly turnovers of RM135.2 billion. Similar progress has been achieved on the international front. There has been a significant increase in the number of Islamic financial institutions that have been established in the global financial system, and the funds seeking for Shariah-compliant investment avenues have also increased dramatically.
José De Gregorio: Autonomy of the Central Bank of Chile, 20 years on Presentation by Mr José De Gregorio, Governor of the Central Bank of Chile, at the commemoration of the 20 years of autonomy of the Central Bank of Chile, organised by ICARE, Santiago, 29 October 2009. I thank Luis Felipe Céspedes and Jorge Restrepo for valuable comments and ideas in preparing this presentation. *  *  *  The autonomy of the Central Bank of Chile is enshrined in the Constitution, specifically in the Basic Constitutional Act of the Central Bank of Chile enacted in October 1989 that constituted a fundamental change for the functioning of the Chilean economy. The Law stipulates that the Central Bank is an autonomous entity, of a technical nature, created in accordance with constitutional provisions, with full legal capacity, the full owner of its assets and of indefinite duration.

Muhammad bin Ibrahim: Audit as a partner of change Remarks by Mr Muhammad bin Ibrahim, Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the 5th PETRONAS Board Audit Committee (BAC) Forum “Audit as a partner of change”, Kuala Lumpur, 16 August 2016. *  *  *  The theme of today’s forum “Audit as a Partner of Change” is highly relevant and timely, as the events in the global market today, involving failures of large firms, frauds and market manipulation activities, underscores the criticality of the three lines of defenses in organizations. For confidence and trust to be restored in the marketplace, the role of the BAC and internal auditors as the third line of defense will be even more critical than ever. Our role as members of audit committees is much broader than what we may perceive it to be. Organisations such as PETRONAS are widely regarded as amongst the few key flag bearers for the country. Hence, it is incumbent upon the Board and the BAC members to be strong and energetic in upholding the highest standards of professionalism, ethics and integrity in discharging their roles and responsibilities. The people of Malaysia must have confidence and pride that an institution entrusted with much strategic natural resources are run with utmost integrity and professionalism. Before I proceed further on the topic for today, allow me to touch briefly on the current outlook on the global and domestic economy.
There is also an interaction: •  In its budget resolutions, the government authorities will attach importance to the effects of the budget on the Norwegian economy and will therefore take account of interest rate effects. In this way, they avoid a situation where growth in public expenditure and the interest rate push the economy in different directions. •  With a known monetary policy response pattern, the parties to the centralised income settlements can take into account interest rate effects when wage increases are agreed. •  Moreover, the parties to public sector negotiations can take into account that the higher the pay increases are, the fewer there are that can be remunerated over government budgets. The interaction here came into clear evidence when employment in the general government sector fell after the expensive wage settlement in 2002. The authorities can achieve better economic policy results if they can commit in advance to a set of credible policy rules. Households, enterprises and capital markets are forward-looking in their decision-making. It is therefore important that the authorities do not sow doubt, but on the contrary act in a long-term and predictable manner. There must be consistency between plans and actions. Monetary policy’s role is to ensure low and stable inflation. Experience shows that we cannot reduce unemployment over time by simply accepting somewhat higher inflation. In many countries, also in Norway, confidence that inflation will be held at bay has increased because interest rate setting has been delegated to the central bank.

12  BIS Review 3/2010  Figure 7 Sweden’s current account and real exchange rate Per cent of GDP and index, 18 November 1992=100  Note. Striped bars and broken lines represent the Riksbank’s forecasts. Sources: Statistics Sweden and the Riksbank. Many indications that krona will continue to appreciate Let me now summarise the Riksbank’s assessment of the more long-term developments in the exchange rate. Our assessment is that the surplus on the current account will decline over the coming years, and this is linked to a stronger real exchange rate. In recent years, growth has been relatively high in Sweden compared with other countries, and our assessment is that this tendency will continue. There are thus good arguments why the real exchange rate should strengthen in the coming period. The real exchange rate can strengthen not merely through an appreciation in the nominal exchange rate, but also by inflation being higher in Sweden than in other countries. However, we have no reason to believe that inflation in Sweden will differ substantially from that of other countries over the coming years. The change in the real and nominal exchange rate could therefore be expected to be roughly the same size (see Figure 3). In addition to the more long-term driving forces that I have taken up, there is a further factor pointing to a stronger krona in the coming period. The severe weakening of the krona as a result of the financial crisis was probably linked to the financial turmoil that arose.
The main risk factors to financial stability are: (i) the undercapitalisation of a large number of companies (276.4 thousand firms with net worth below the required threshold, out of which 268.5 thousand firms with negative equity), induced particularly by losses (217.3 thousand firms with total losses of lei 33 billion in 2016), as well as the high indebtedness level in certain sectors, (ii) the increase in past due obligations to the government budget (up 5.9 percent in 2016), (iii) the low capacity to recover commercial claims, especially at the level of micro-enterprises, (iv) corroborated by the large number of firms in credit institutions’ portfolio which have not gone through a full business cycle, (v) the return of insolvency to an upward trend in terms of both the number of newly-insolvent firms (6.1 thousand firms in the first eight months of the year) and the volume of non-performing loans generated in the banking sector (the volume of non-performing loans generated by the companies undergoing insolvency proceedings increased by about one third to lei 1 billion) and (vi) the rise in overdue payments of the government budget to the real sector (up 9 percent in the period from September 2016 to September 2017 to lei 223.1 million). In a broader perspective, the weak payment discipline economy-wide has highlighted structural vulnerabilities in the balance sheets of companies (Figures 31-34). It is worth noting that the poor payment discipline economy-wide is not a new risk, but a recurrent vulnerability in Romania’s economy.

Additionally, within the National Committee for Macroprudential Oversight, the NBR has underlined the financial stability risks deriving from soft budget constraints in the economy. In order to strengthen the economy’s resilience to external shocks, particularly those related to credit risk, it is necessary to have in place a prudent and balanced mix of economic policies that should pursue the return to the medium-term objective (structural deficit narrowing) and the improvement of payment discipline economy-wide. 9  Charts  Figure 1. Public debt (2017) 180  Figure 2. Romania: Average residual maturity of public debt  percent of GDP  9  years  8  160  5.8  6  120  8.0  8.1  5.7  5.8  5.8  3.5  3.5  2016  Jul.17  7.2  7 140  7.8  6.2 5.3  5 4.0  4.1  4.4  4  100  3.8 3  80  2 60  3.0  3.0  2014  2015  2.4 1.6  1.7  2011  2012  1  40  0 2013  20  Source: AMECO  EU EA  GR IT PT BE CY ES FR UK AT HR SI IE HU DE FI NL MT PL SK LT RO SE LV DK CZ BG LU EE  0  average residual maturity – total debt average residual maturity – domestically issued debt average residual maturity – eurobonds Source: MPF 2  Figure 3.
Moreover, the banking sector has significant exposure to the NBLs, through commercial loans to these institutions. In particular, loans to this segment have increased among medium-sized banks in recent years. Thus, the exposure—to NBL debt—of the large and medium-sized banks, as of February 2019, represented 12.7 and 27.2% of their regulatory capital, respectively. The profitability of the NBLs, measured through ROA, has been relatively stable, standing at 4.6% at year-end 2018 for retailers; 3.8% for S&Ls; and 2.6% for factoring, leasing, and car dealership (FL&A) together. In the case of the CCAFs, ROA has increased in the last two years. The leverage ratio, in turn, is highest for the FL&A group, and it increased for the retailers in 2018. Page 6 of 12  Central Bank of Chile September 2019 High-level Policy Seminar on Integration or Fragmentation?

In this regard, I urge the industry to take advantage of the knowledge and experience of the panel of experts assembled here at this conference, to better understand and prepare for the implications of the review of the FATF 40+9 Recommendations, and the expectations on financial institutions and boards of directors moving forward. For Bank Negara Malaysia, the enhancement to the nation’s infrastructure to combat financial crimes will remain as one of our key priorities. In this regard, our role as Malaysia’s primary financial regulator will continue to focus three broad areas. The first is to deter and prevent criminals from abusing the financial system to be the conduit for illegal activities by ensuring the continued effectiveness of Malaysia’s legal and other relevant infrastructure, systems and processes in combating financial crimes. Secondly, is to ensure all financial institutions continue to strengthen their defences against such threats and risks via our regulatory policies as well as risk-based supervisory and surveillance activities; and thirdly, to strengthen collaboration between the financial industry with other domestic and international stakeholders in AML/CFT initiatives to protect the integrity and stability of our financial system, including implementing capacity building programmes, such as this Conference.
In Malaysia, the progress in this area has been facilitated by the common law which forms the foundation of the legal system. More specifically, the concept of "trust" under the common law has facilitated the issuance of Islamic securities such as sukuk and Islamic Real Estate Investment Trust (REIT). Since "trust" as an inherent notion embedded in the common law system is not generally found in the jurisprudence of civil law, some civil law countries have enacted specific legislation to provide for the introduction of trust so as to align their legal systems with the requirements of Islamic finance. The challenges brought by the integration of Islamic finance with the international financial system While legal issues within a domestic financial system can be resolved by the home regulators and Shariah authorities, the integration of Islamic finance with the international financial system brings with it many challenges. There is a need for mutual recognition of financial standards and products across jurisdictions. The progressive harmonisation of Shariah, in this respect, needs to be viewed as a driver towards greater international financial integration. Such a convergence and harmonisation can only happen with greater engagement among the regulators, practitioners and scholars in Islamic finance in the international community. The Annual International Shariah Scholars' Dialogue that has been taking place since 2005 is aimed at achieving this objective. This Dialogue has served to promote interactions between Shariah scholars from around the world contributing towards greater understanding and international convergence.

The Governors look forward toward greater collaboration between WAIFEM and these institutions in the years ahead. On this note I have the honour to declare the course open. I thank you for your attention. BIS Review 79/2006  3