samchain/econo-pairs-v1 huggingface dataset:
We have encouraged banks to become more transparent in providing the public with more timely and transparent information on bank management, especially information relating to non-performing loans, lending to related parties, and violation of the Bank of Thailand’s regulations as well as the fines incurred. In addition, we have encouraged banks to give greater importance to and abide by the best principles of corporate governance by limiting the number of outside directorships which the bank directors or bank senior executives may hold to not more than three, as well as not being an authorised director. Before the announcement made on this issue by the Bank of Thailand on 17 September 1999, there were a total of 82 bank directors holding more than 3 outside directorships. The number has now reduced to 22, and should be finally phased out. To reduce the risk of economic bubbles and the consequence to financial institutions, the Bank of Thailand plans to reduce the reliance of the private sector on bank credits, from a share of 77 % of the total sources of funds, presently, to 55 % in the next 10 years. This requires that Thailand must have strong markets for debt instruments and equities. Thus, the development of the bond market is among the major tasks the Bank of Thailand has undertaken during the year, as it will provide the infrastructure for the conduct of monetary policy through open market operation, as well as enhancing the country’s long-term economic development.

The Bank will continue to support this need as it is deemed possible, under the Inflation Targeting framework. As for the exchange rate, the stability of the baht has improved, due to measures that have been implemented. The Bank of Thailand will continue to closely monitor international capital flows and exchange rate movements in order to ensure timely policy responses to different circumstances. In the area of international reserves, the Bank of Thailand has set a plan to repay loans. However, given our relatively modest reserves, it might be appropriate to consider using new interest incomes that will accrue from these reserves to repay loans. This may be deemed a better alternative than to keep on accumulating reserves, whilst taking on new borrowings to repay existing debts. What I have said so far should help make it clear that, in spite of increasing global risks in the next year, we remain in a position to be able to steer our economy towards another year of satisfactory rate of economic expansion. As for the economic problems that remain to be solved, this should not be a cause for much concern, as we have already prepared the appropriate policy framework and strategy to address them. It is only for the newly formed government to give importance to these policy frameworks, as well as to pay attention to the following three areas that are critical to the long-term survival of the Thai economy: 1.
I would add one other thought on the demand for banknotes, which is more to do with human psychology. I suspect most people, however much they use cards, feel a degree of comfort from knowing that they also have cash in their wallet or purse, even if it is as a back-up. What does this analysis tell us about future demand for cash? As a central bank responsible for the issuance of banknotes, two principles are at the front of our thinking: first, that we issue central bank money, in the form of claims on the Bank of England; and second, that in doing so we must meet the public’s demand for our notes. By issuing central-bank money, we are providing both a means of payment and a store of value. But I think we should recognise that the paradox of banknotes that I have described indicates that there may well be a limit to the growth of the value of notes in circulation insofar as the use of banknotes as a means of payment is not increasing. This is, though, a broad assessment, and I would not wish to offer a judgment on the level at which the demand of the public to hold more banknotes will peak. An important reason for this uncertainty is that, as recent experience indicates, the demand for banknotes as a store of value is dependent on the state of the economy and the financial system.

Also on the policy response to the crisis, we have invested in stress-testing to examine how the balance sheet performs under stress, and thus establish whether the bank is robust in terms of its loss absorbency to extreme but plausible outcomes. This is a central part of what we describe as our forward looking judgemental approach to supervision. I have not so far mentioned one other very important part of the post-crisis reform package, namely ensuring that banks can be resolved if they fail. This should be done without recourse to public funds or the disruption of the critical economic functions provided by banks, such as continuity of access to deposits. At the heart of the resolution reforms is the concept of bail-in, which is that private creditors of a bank absorb the cost and provide the new equity to sustain the provision of these critical functions in the event that it suffers large losses that cause failure. There is nothing radical about the concept of bail-in, which is a debt-equity conversion should a trigger event occur. That is consistent with well-established principles of company restructuring. But with banks it has to happen very quickly if the trigger event that the bank is no longer viable occurs. We cannot wait for a lengthy bankruptcy process. TLAC (Total Loss Absorbing Capacity) or MREL (Minimum Requirements on Eligible Liabilities) are used to describe the specific liabilities which banks will be required to maintain to ensure there are enough liabilities which can feasibly and credibly be converted.
The economic model they have developed – of ‘diagnostic’ expectations – is appealing because it starts from research on how humans form beliefs about the future, and how they act on those. The way in which investors and markets form expectations of the future is clearly an area that merits further research. As I will go on to discuss, it is important to those of us responsible for financial stability to understand what is driving the expectations of the future that underlie risk-taking And what drivers kick in when those expectations meet the future and have to be adjusted. Macroprudential Policy As I said at the outset, I expect the next ‘crisis’ to involve some form of over-valuation of assets, over-extension of credit and losses when this corrects. While infrequent, significant adjustments seem to be a feature of the system. The more important question, in my mind, is whether those adjustments destabilise the financial system and lead to very disruptive economic impacts. Will adjustments lead to ‘great financial crises’ as they did 10 years ago or will the system be able to absorb the adjustment and perhaps even dampen its impact? In the first instance, it does not matter whether expectations are rational and are then significantly adjusted because of ‘news’ or whether they are irrational and extrapolative and get adjusted because reality has caught up. Either way, the costs of financial crises can be minimised and perhaps avoided if the system is resilient to shocks that are possible even though they are very unlikely.

1  16  All speeches are available online at www.bankofengland.co.uk/speeches  16
Despite a challenging environment, new issuance of sukuk in the global sukuk market rose by 43 percent to $ billion in 2009. However, developments in Europe resulted in a more cautious market and the global sukuk issuance declined by about 20 percent in the first half of this year. In the coming period, this trend is expected to improve as the Governments in Asia and the Middle East have already initiated the raising of funds for the implementation of infrastructure development and investment projects. This extensive interest in Islamic finance from different parts of the world is driving the international dimension of Islamic finance. This has contributed to the strengthening of financial and economic linkages between the more established financial centres of the Western world and the newly emerging financial centres in Asia and the Middle East. This has thus contributed to the more efficient allocation of funds across borders from centres with surplus funds to regions with investment opportunities. It has also allowed for more inclusive participation regardless of size and stage of development. Islamic finance now provides the range of financial products and services to multinational corporations, to micro enterprises and to households while at the same time, facilitates financing of international trade and cross border investment activities. This recent decade has also seen significant milestones being achieved in the area of international financial infrastructure that supports the development of Islamic finance.

Nor Shamsiah Mohd Yunus: Reshaping Malaysia's future - setting the goal for greater governance and transparency Keynote address by Ms Nor Shamsiah Mohd Yunus, Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the 10th International Conference on Financial Crime and Terrorism Financing "Reshaping Malaysia's Future – Setting the goal for greater governance and transparency", Kuala Lumpur, 30 October 2018. * * * A very good morning to all of you. It is my pleasure to address all of you today at this very important conference. Financial crime. Terrorism financing. Corruption and money laundering. These are heavy words that carry the feelings of outrage and displeasure, amongst others. The United Nations Office of Drugs and Crime estimates that every year globally, a staggering amount of USD2.6 trillion is stolen through corruption. Yet, I suspect, in reality, figures like these are so large that many may find it hard to relate to it. To put it in perspective, the figure is around eight times larger than the Malaysian economy. Let us also take the UN Sustainable Development Goals that aims to improve the lives of the poor, improve governance and address inequality. Some estimate that it will take around USD5-7 trillion to meet all the SDGs. This represents 2-3 years’ worth of money lost to corruption. In other words, the money lost through financial crimes is a devastating opportunity cost, draining the resources that could have been used to permanently uplift the lives of billions in this world.
On the one hand, Malta’s successful experience with a peg in terms of price  4  BIS Review 61/2004  stability, coupled with the importance of exchange rate fixity for a small open economy that is heavily dependent on foreign trade and investment, suggest that it would be desirable if the features of the present exchange rate regime - predictability and stability - were preserved while Malta participates in ERM II. On the other hand, the appropriate width of the bands in ERM II is inversely related to the degree of convergence achieved with the euro area, but positively related to the size of the fiscal deficit. Whether the continuation of the features of the current regime will remain possible or not, with all the advantages that it brings to the business community, thus depends on the extent of progress with structural reforms and fiscal consolidation. It is, therefore, vital that the reform agenda remains on track. It is in the common interest to ensure that the economy converges faster towards the high levels of efficiency and living standards of the euro area. The business community clearly has an interest in contributing to the achievement of this objective, both by modernizing its structures and operational practices so as to be better placed to seize the opportunities and also by participating constructively in national fora such as the MCESD. BIS Review 61/2004  5

Today, I will first elaborate on two challenges that will continue uniting us: the need for good national economic policies, pro-business and long-term oriented; and the need for active multilateralism to face our global challenges. Then, I will dwell on a challenge that we will have to address together: our future relationship and Brexit. ** I. The need for pro-business and long-term national economic policies  Let me start with the challenge of national economic policies. In the euro area, the economic recovery is now robust and broadly-based across countries and sectors. GDP growth should stand at at least 2.2% in 2017 according to our ECB forecast. The ECB’s accommodative monetary policy has contributed to this acceleration of growth in the euro area. Yet monetary policy cannot be the only game in town. Structural reforms in each country, along with stronger European coordination, are of the essence to boost potential growth in the medium term and to treat the fatal disease of mass unemployment. In recent years, several European countries, including in Southern Europe, have successfully carried out in-depth reforms that are yielding positive results in terms of growth and employment. Germany, the Netherlands and Nordic countries, as well as Spain and Portugal, are proof that economic success, a solid single currency, and the European social model are compatible. We should run pro-business, long-term oriented, fiscally sound economic policies, while keeping the core elements of a common social model, which can be the DNA and pride of Europe in this highly divided world.
So on that point, there is no ambiguity at all. We are also strongly thinking that better coordination for big cross-border institutions is absolutely necessary; even if we could cope with all the issues at stake in the present circumstances, we should not forget that. It's clear that we can improve the present framework and we have to improve it. Some avenues have already been suggested by Ecofin. There has already been a consensus on appropriate Memoranda of Understanding. But going further in this direction also seems important. At this stage, I have to say, I do not have a full-fledged Governing Council position. We are still reflecting, and we will see what will be the position of the Governing Council. But I understand that the European Parliament has carried out several works which have been done within the suggestion that the ECB would play a particular role in this domain for the coordination of surveillance for cross-border institutions – a little bit like in the US. The Federal Reserve has a position which concentrates very much on the big cross-border institutions. And I see also suggestions coming from the private sector, coming from the industry, that we could play a more important role in this domain.

We had to test the capacity to have such teleconferences at very short notice, in order to be sure that we could confront any new situation. We had a large number of teleconferences with the Governing Council. You see there…[points to telephones on table] If the situation were to demand now that we had in one hour and a half a teleconference with the Governing Council, we will then indeed have a teleconference in one hour and a half. The full continent would be there. That’s very impressive, because this would mean all members of the Governing Council from Ljubljana to Helsinki and from Lisbon to Dublin. FT: And as you say, an exceptional crisis, a global crisis. How much worse would it have been without the euro? Trichet: It is very difficult to reconstruct history with new assumptions. But my memory of what we experienced together in the old days is certainly that we would have had a situation which would have been very difficult, because on top of all of these global challenges that are without precedent, we would have had to cope with the intra-European tensions, the  BIS Review 159/2008  1  equivalent of the intra-ERM 1 tensions, and that would have been demanding. There is no doubt from that standpoint that the enormous challenges we had at the level of the euro area as a whole were, very fortunately, not the result of intra-euro-area tensions, and that is something which is important.
BIS central bankers’ speeches  Together these dynamics have raised desired savings and lowered desired investment. With more savings chasing fewer investment opportunities, equilibrium safe returns have fallen sharply towards zero (Chart 8 – see also Annex). Colleagues at the Bank of England estimate that these factors can explain around 400 of the 450 basis points fall in global longterm equilibrium rates since the 1980s. 4 The persistence of many of these trends suggests that the global neutral real rate could settle around 1% over the medium to long term. Chart 8 Secular drivers pushing down on rates  Why does that matter? Central banks must set their policy rates with regard to equilibrium interest rates in order to maintain demand growth in line with supply growth and to stabilise inflation. Setting real interest rates substantially above the equilibrium rate would, in time, generate rising unemployment and falling prices. The opposite is true of setting rates substantially below the equilibrium rate. The substantial variance of the equilibrium rate over time means that a 4% policy rate would have been highly stimulative in 1980 but would be highly contractionary today. At the onset of the crisis, as households and firms sought to de-lever, the equilibrium rate fell sharply, calling for reductions of conventional policy rates to unprecedented levels. The necessary easing, however, went well beyond what central banks could deliver with short rates alone.

8  I remember this period very vividly, because I was fortunate to have the opportunity to discuss and debate the problems of current monetary policy, deflation and liquidity traps in a group of great economists at Princeton University that included Ben Bernanke (before he left to be a Governor at the Federal Reserve Board), Alan Blinder, Paul Krugman, Chris Sims and Michael Woodford. 9  See Svensson (2003a) for a discussion of policy options before and in a liquidity trap. 10  Kohn (2008), after extensive discussion, concludes that there is insufficient evidence that low interest rates would have contributed much to the house-price boom and that higher interest rates would have had much dampening effect on it. Del Negro, Marco, and Christopher Otrok (2007) find small effects of Fed monetary policy on house prices during 2001-2005, whereas Iacoviello, Matteo, and Stefano Neri (2008) find larger effects, although their including the Regulation-Q period in their sample may increase the apparent monetary policy effect on housing. BIS Review 112/2009  5  One obvious conclusion is that price stability is not enough to achieve financial stability (Carney 2009, White 2006). Good flexible inflation targeting by itself does not achieve financial stability, if anyone ever believed that. Specific policies and instruments are needed to ensure financial stability. Another conclusion is that interest-rate policy is not enough to achieve financial stability.
However, there are clear differences between so-called financial risks (such as credit and market risk) and non-financial risks, which by their nature are more difficult for credit institutions and supervisors to address. Non-financial risk is directly related to malpractice or non-compliance proper to conduct risk; but going beyond this conference’s theme, it also refers to IT events, reputation, governance and cyber security. Unlike credit or market risks, non-financial risk is unconnected to specific financial decisions, is much more difficult to quantify than traditional risks and can only be reduced or mitigated. Despite all these difficulties, or perhaps precisely because of them, non-financial risk has been firmly on regulators’ and supervisors’ radar screen since at least 2004. This followed the approval of Basel II which, as I indicated earlier, included a capital requirement for operational risk. Today, the measurement and management of these risks remains equally complicated, but their importance for banking business has in fact increased. Evidence of this is the map of risks and vulnerabilities annually published by the Single Supervisory Mechanism (SSM). Viewing the snapshot for 2021, we can see how a large portion of the sector’s weaknesses are related to non-financial risk. This is not really anything new. In previous exercises the SSM has also included these components. And logically so.

The outlook for global growth is nevertheless subdued, and has, if anything, deteriorated since the last monetary policy assessment. The most recent US economic data have been somewhat better than expected, but the escalation of the European debt crisis has clouded the economic outlook for the euro area. Bond yields for fiscally weak states have risen markedly. The growing unease among market participants is also reflected in the increased volatility on the financial markets. Mounting borrowing costs and the high level of uncertainty are contributing to a marked worsening of the business climate in the euro area. BIS central bankers’ speeches  1  The SNB has adjusted its growth assumptions for the euro area over the next three years substantially downwards. For the rest of the world, on the other hand, our forecasts remain essentially unchanged. Uncertainty about the future outlook for the global economy remains extremely high. In particular, the European sovereign debt crisis poses grave risks for the international financial system and the real economy. Swiss economic outlook In Switzerland, the pace of growth slowed considerably in the third quarter. According to preliminary estimates, annualised real GDP increased by only 0.9%. In particular, the substantial appreciation of the Swiss franc over the summer is weighing heavily on the Swiss economy. Exports fell sharply. At the same time, domestic final demand stagnated. The economic slowdown was accompanied by a slight decrease in technical capacity utilisation. In manufacturing, it is now around the long-term average.