10  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  10  Table 1: Lessons from the dash for cash for future market dysfunction tool design  Standing liquidity facilities for banks  Special market wide operations using large scale asset purchases and other preexisting tools  Positives  Challenges  Future design questions  Regular, well understood  Banks did not meet all nonbank liquidity needs – so not a fully effective conduit for central bank liquidity  Whether central banks need the ability to reach a wider range of market participants directly (and, if so, who)  Operations typically one way (‘buyer of last resort’) and much longer duration than the dysfunction  Whether there should be more targeted two-way or selfliquidating tools better aligned with term of dysfunction  Operations conducted using tools also aimed at easing monetary policy  How to deal with market dysfunction in periods when the optimal policy response differs from that required for monetary policy purposes  Operations were ad hoc or discretionary  Whether more permanent standing facilities might better shape expectations  Effectiveness – ‘got in all the cracks’  No explicit ‘insurance premium’ in facility pricing – risks fuelling moral hazard if expected to prevail in future  Whether to adopt Bagehot pricing/terms: eg buying at below pre-stress prices but above stress prices and/or pricing / haircuts  Took risk off private sector balance sheets  Added risk to public sector balance sheets  How to judge appropriate risk sharing, and set bounds on public sector exposure  Ability to ‘go big and go fast’ necessary in the face of the Covid pandemic  The first is that central banks are likely to face increasing calls to provide public liquidity insurance for instances of severe financial market dysfunction in the years ahead, as the reliance on those markets grows, vulnerabilities to liquidity shocks persist, and intermediation capacity remains constrained.

Now the public administration has become a client of the system and I think that there are real opportunities to resolve the utility services payments through the banking system. Also, I hope that the system will be aggressive and will keep promises to the public to put its windows at the service of selling Treasury bills directly to the interested public. We, as Bank of Albania, have kept our promises and very soon we will introduce as a first step a commission that is presumed to cover the transaction cost while we will accompany this move by the ban of cash flows receipt at the windows of Bank of Albania. We shall request the individuals that their participation in the auctions, through windows of Bank of Albania, will become possible only upon presentation of a banking document, which certifies that the client has deposited a certain amount as a guarantee in one of the banks pertaining to the system. Another direction on which banks must further focus relates to an aggressivity of broader propaganda and clarification. I think that still the majority of common people show a certain hesitation to refer to banks. I believe that they have a feeling of non-confidence that the bank shall not resolve their problems. Many individuals, though in an absurd way, are still in search of a “friend” to negotiate with the bank.