samchain/econo-pairs-v1 huggingface dataset:
According to the Basel Committee on Banking Supervision, operational risk is the “risk of loss resulting from inadequate or failed internal processes, people and systems or from external events”. This definition is based on the underlying causes of operational risk at the broadest level and includes legal risk, but it excludes strategic and reputational risks. The Basel Committee has also asserted, “the most important types of operational risk involve breakdowns in internal controls and corporate governance.” That’s why Basel II aligns with a variety of other regulations and supporting frameworks for enhancing corporate governance. 'Management of operational risk is thus taken to mean the 'identification, assessment and / or measurement, monitoring and control of mitigation of this risk. While many of these risks are inherent and visible in day to day operations of banks, some components are applicable to supervisors and regulators. 4. The banking industry’s awareness of operational risk and efforts to manage it have accelerated in recent years, driven in part by an increasing desire to improve operating efficiency, reduce earnings volatility, rationalize the allocation of capital between competing businesses. It is not easy to get banks to identify and assess the operational risk inherent in all material products, activities, processes and systems and in particular to follow such practices when new products are introduced.

Gent Sejko: Comments on cooperation extension between Albania and Swiss State Secretariat for Economic Affairs Speech by Mr Gent Sejko, Governor of the Bank of Albania, at the ceremony of signing the Memorandum of Understanding between the Swiss Government's SECO and the Bank of Albania, Tirana, 1 March 2019. * * * Dear ladies and gentlemen, Today we start the second phase of the cooperation with the State Secretariat for Economic Affairs (SECO), which provides, on behalf of the Swiss Government, technical assistance to support, among others, central banks. I take this opportunity to extend our profound appreciation and gratitude to the Swiss Government, which has continuously provided assistance to the Bank of Albania – either directly or through other financial institutions – in the areas of payments, financial inclusion and monetary policy. Today, we are signing a new cooperation agreement with regard to perfecting our analyses and decision-making processes. The development and the continuous enrichment of scientific capacities of our talented staff, and the implementation of research and analysis methodologies to support the decision-making and policymaking processes are a priority for the Bank of Albania. In this context, it is a pleasure and honour for me, as the Governor of the Bank of Albania, to sign, together with H.E. Ambassador Maître, this agreement between our two institutions. At the Bank of Albania, we are very enthusiastic about this cooperation.
Andrew G Haldane: Accounting for bank uncertainty Remarks by Mr Andrew G Haldane, Executive Director, Financial Stability, Bank of England, at the Information for Better Markets conference, Institute of Chartered Accountants in England and Wales, London, 19 December 2011. *  *  *  The views are not necessarily those of the Bank of England or the Financial Policy Committee. I would like to thank Alan Ball, Verena Bracke, Antony Ford, Priya Kothari, Vasileios Madouros, Colin Miles and Peter Richardson and Paul Tucker for comments and contributions. Introduction1 Fair value accounting principles are under attack from all quarters – accountants, regulators and politicians. The paper by Christian Laux is a welcome attempt to shed some analytical light on this heated debate. It represents a staunch defence of fair value accounting principles, as the least-worst means of measuring and managing financial risk. It makes a compelling case. In these comments, I will focus on three issues. Linking these issues is the idea that the special characteristics of banks might require a special accounting treatment, perhaps even a distinct accounting regime. As context for that, the fair value debate is first placed in some historical context. Accounting rules for banks have not stood the test of time, especially at crisis time. Better recognition of the uncertainties associated with bank assets, and the fragilities associated with bank liabilities, might make for a more durable accounting regime. Fair values and financial crises The fair value debate is not a new one.

Plantin, G, Sapra, H and H S Shin (2008), “Fair Value Accounting and Financial Stability”, University of Chicago Graduate School of Business Research Paper 08–15. Simonson, D G and G H Hempel (1993), “Banking Lessons from the Past: The 1938 Regulatory Agreement Interpreted”, Journal of Financial Services Research, pages 249–267. BIS central bankers’ speeches  7
Norges Bank is among the top ten shareholders at around half of the companies we are invested in, and we have found that companies listen to what we have to 2/6  BIS central bankers' speeches  say. Responsible investment – a chain of tools Chart: Responsible investment – a chain of tools Responsible investment is the most important tool in our work on climate risk and climate-related investment opportunities. I will now look at some important parts of this work. We are already doing a great deal, but we now plan to do even more. This work can be divided into three target areas: markets, companies and the portfolio. This results in a complete chain of tools. I will not review this work in detail here, but focus on a few key aspects. Establishing standards The first, establishing standards, concerns standards for reporting and measuring companies’ climate risk. Good common standards are important. They help us as an investment manager to assess companies’ prospects, prioritise our ownership efforts and make sound investment decisions. And not just us. Better reporting will also make financial markets function better and channel capital better. International standards provide consistency across markets and set the bar for all companies. We, and other large investors, have an important part to play in the development of such standards. One particularly important initiative we have supported is the climate reporting framework from the Task Force on Climate-related Financial Disclosures (TCFD).

To conclude, I am confident that if the Spanish economy is capable of mobilising the potential nurtured over many years of building up stability and improving the workings of markets and institutions, then it may rise to the challenges and difficulties facing it and continue to make progress in the medium term in narrowing the welfare differences with the most advanced countries. 1  BIS Review 122/2008  7
It follows inevitably from this that there will be tensions and arguments between regulator and regulated. However, these frictions should not be bigger than they have to be – in other words, we should aim for a system in which the burdens on firms created by our regulation are no greater than they need to be to achieve the objectives set by Parliament. Part of this is about the ability to adapt regulation for different types of businesses, as given the enormous diversity of financial firms operating in the UK it is unlikely that one size will fit all in all cases. The other side of this coin is that we cannot run a zero-failure regime. 4. Dynamism and responsiveness. Sometimes these words – “dynamism”, “responsiveness” and indeed “proportionality” above – are understood to imply weak regulation, which unsurprisingly we at the Bank are firmly against. So because of this danger of a whiff of weakness we have thought very carefully about whether it is important to have something like this as part of our list of principles. We have concluded that it is necessary for a simple reason: the financial system is an extraordinarily adaptive organism and is constantly changing. Sometimes this is for good reasons, for instance as it adopts new technologies in order to deliver a better product.

However, we should go one step further and look at the social values and preferences that influence the behaviour of economic agents who interact with, and are affected by, the economic institutions referred to earlier. After all, the various reforms envisaged in the Lisbon agenda will fail to produce tangible results if they run counter to what many Europeans perceive to be quintessentially European values, preferences and attitudes. As outlined in the simple conceptual framework introduced earlier, economic performance and the functioning of markets can be directly influenced by values and deeply held beliefs – such as self-realisation, fulfilment in life and other post-materialist values; the relative importance of work, achievement and success; freedom, competition and cooperation; tradition and religion; family and community; safety and protection, etc. A number of economists have argued that lower labour force participation rates and shorter working hours in Europe relative to the US may reflect a preference on the part of Europeans for more leisure time over additional income.4 In other words, that Europeans seem to place more value on extra leisure than having a few extra euros in their pockets, while Protestant work ethics and a more materialistic attitude to life drive Americans to work harder.
It is in this context that the Central Bank has pledged, in its policy statement, “Road Map: Monetary and Financial Sector Policies for 2007 and Beyond” that it would expand the work of Financial Intelligence and actively investigate and take actions to combat money laundering and terrorist financing. In the years 2005 and 2006 Sri Lanka made considerable headway in this regard. The main actions in this context were the enactment of three laws, namely, The Convention on the Suppression of Terrorist Financing Act, The Prevention of Money Laundering Act, and the Financial Transactions Reporting Act. The FTR Act created the institutional body of the FIU with regulatory powers and a mandate to formulate policies and guidelines to meet the Financial Action Task Force (FATF) 40 + 9 recommendations. This legislative package was the outcome of an in-depth consultation initiated by an inter-ministerial committee which engaged the stakeholders such as the banks and professional bodies. In the preparation of the legislation, the inter-ministerial committee closely liaised with the IMF in order to ensure that legislation complied with the Financial Action Task Force 40+ 9 recommendations. Even prior to the enactment of this legislation in Sri Lanka, there have been certain punitive measures in place, to discourage individuals from using the country’s financial institutions for Money Laundering and Financing of Terrorism activities. These measures were taken under the Exchange Control Act; the Customs Ordinance and the Banking Act.

Hence, the enactment of the legislation by our country’s legislature is welcomed by all of us who value stable economies and peaceful societies. Due to the scale and magnitude of the heightened global interest in Money Laundering and Terrorist Financing, international obligations too, required many countries to introduce  BIS Review 9/2007  1  legislation. In fact, in terms of their international obligations the legislative approach pursued by many countries, including Sri Lanka, has been in the context of Security Council Resolution 1373 dealing, inter alia, with financing of terrorism and the International Convention on the suppression of financing of terrorism. These agreements have, to a great extent, unified the world in its fight to meet this challenge and, I dare say, the closing of ranks among the countries of the world, would have certainly helped to curtail terrorism which may otherwise have reached unimaginable levels, thereby threatening world peace in general and the world economy in particular. Let me now say a few words about our own efforts in this sphere of activity. The initial phase of establishing a comprehensive framework for anti money laundering and combating financial terrorism in Sri Lanka was focused on the preparation of the draft legislation. With the passage of legislation, our efforts were then directed towards setting up of the infrastructure for the Financial Intelligence Unit (FIU). We now have a fully operational FIU established in the Central Bank, the apex institution in the financial system in Sri Lanka, to meet both its local and international obligations.
On the other, they intensify the severity of potential market crashes. Such examples illustrate the importance of the FMI for the effective functioning of financial markets as a whole. I would now like to explain why it matters to the SNB. To fulfil its mandate, the SNB is involved on three levels. First, as a market participant with a special role because it uses market transactions to implement monetary policy. Second, it acts as the “system manager” of the Swiss Interbank Clearing (SIC) payment system, making sure that high value transactions can be made with central bank money. In this function, the SNB also monitors daily operations and is responsible for crisis management in the event of disruptions or incidents. Third and finally, the SNB oversees the systemically important elements of the FMI, monitors developments and strives to identify areas of tension or imbalance that could jeopardise the stability of the system. These observations make it clear that a well-functioning, safe and efficient FMI is critical to the central bank. The strengths of Switzerland’s FMI and its collaborative roots Switzerland’s FMI has been effective to date. I would now like to describe its strengths and discuss their foundations. The strong suit of the Swiss FMI is the integration of all back-office components in a chain of systems known as the Swiss value chain (SVC).7 The SVC allows complete electronic integration of different types of platform: trading systems, securities settlement systems, central counterparties and payment systems.

The Rt Hon Sir Edward George GBE: Recent UK economic developments against the background of world economic activity Speech by The Rt Hon Sir Edward George GBE, Governor of the Bank of England, at the Chartered Institute of Bankers in Scotland Biennial Dinner at the Exchange, held on 15 January 2001. *  *  *  Mr President, Lord Provost, my Lords, Ladies and Gentlemen, This is the fourth occasion on which I have been honoured to be invited to speak at this great biennial dinner of the oldest Institute of Bankers in the World; and it gives me particular pleasure this evening to join you in celebrating your 125th anniversary. On the three previous occasions I have been able to report to you steady progress of the overall UK economy, but then, as a central banker brought up to look for the dark side of the moon, I’ve gone on to discuss the prevailing risks and uncertainties and to pose the question: can that steady progress be maintained? I will adopt the same format this evening. Since your last dinner in 1999, we have in fact, come through the short, sharp, shock to the world economy, associated with the emerging markets financial crisis, relatively unscathed. Our own economy has now grown continuously quarter by quarter for over 8½ years at an average annual rate of 3%, which is well above most estimates – at least until recently – of a longer term trend rate of 2¼2½%.
A second striking feature has been the rise in the importance of passively managed funds, including Exchange Traded Funds (ETFs) and other index-tracking strategies. These passive or tracking funds have risen from $ trillion in 2003 to almost $ trillion by 2012, a rise in global market share from 5% to 13%. Within this, ETFs have been growing at an annual rate of around 30% for the past decade with AUM currently standing at $ trillion. A third trend – the mirror image of the first two – has been the declining share of actively managed funds operating in large-cap equity and government fixed income markets. Their slice of the global AUM pie has fallen sharply over the past decade, from two-thirds to around a half. For some institutional investors, this is part of a longer-term trend towards “deequitisation” – a dreadful word – to which I will return. The reasons for these shifts in portfolio allocation are not difficult to fathom. Like many advanced economies, the asset management industry is facing its own version of the “squeezed middle”. Active funds operating in core markets, in the middle of the risk/return distribution, are feeling the pinch: from above, due to the rise of alternative funds and strategies seeking higher return in a low yield environment – the search for yield; from below, due to the rise of passive funds and tracking strategies delivering lower cost to investors – the quest for cost.

The children who are here today are growing up in a continent of peace. They belong to the “euro generation” – they have only known one currency. We invited them to attend a photo event with the Governing Council this morning. We are happy for them to be with us on this occasion to mark the launch of the next generation of euro banknotes. BIS central bankers’ speeches  1
In the case of oil, long-term price estimates have fallen in recent years, pulled by both the arrival of new drilling and production technologies and the projected fall in demand. In this market, the entry of shale oil brought down average global oil extraction costs. In addition, the “green wave” would discourage the demand for oil compared to projections of a few years ago. However, it is expected that a price of around USD 60 per barrel will be sufficient to balance out the market in the long term (Table 3). V.  Sensitivity and risk scenarios  The central scenario is built using a set of assumptions, as I have just described, which shape the projections. Sensitivity tests can be performed on said assumptions that, while keeping GDP growth in the foreseen ranges, require a somewhat different monetary policy action. These scenarios form the MPR Corridor (Figure 19). On the one hand, it is possible that demand will expand more than expected, either due to a greater willingness of households to consume—in a context of a gradually deconfined economy—or due to fiscal transfers exceeding those already considered. In the latter case, tax, liquidity or public investment measures could be added, prompting an even more procyclical fiscal policy behavior. In such a situation, higher inflationary pressures would lead to the need for an earlier withdrawal of the monetary stimulus, which is reflected in the upper bound of the MPR Corridor.

Figure 8 Interest rates on nominal 10-year benchmark bonds  Stock markets (*)  (change with respect to 1 July 2020, basis points) 200  Chile  (change with respect to 1 July 2020, percent)  United States  40  Chile  World  30  150  20 100 10  50 0 0  -50 Jul.20  -10  Oct.20  Jan.21  Apr.21  -20 Jul.20  Oct.20  Jan.21  Apr.21  (*) World denotes ACWI stock index in local currency from Morgan Stanley Capital International. For Chile, the IPSA is used. Sources: Central Bank of Chile and Bloomberg. Page 18 of 27  Figure 9 Businesses confidence (PMI) (*) (diffusion index)  Manufacturing PMI  Services PMI  United States  70  Eurozone  70  China  60 60 50  50  40  40  30  30  20  20  10 Jul.19  Jan.20  Jul.20  10 Jul.19  Jan.21  Jan.20  Jul.20  Jan.21  (*) Value below (above) 50 indicates pessimism (optimism). Source: Bloomberg.
We are a union of sovereign states, so you have to take into account the sovereign decision-making process at the level of each nation. The process requires the approval of parliaments. In some cases you might have decisions that are taken very expeditiously because the democratic institutions are functioning very rapidly. In other cases you have to accept that it takes longer to take decisions that would be fully in line with the effective functioning of the democracies concerned. But I do not judge any country. FT: But what role do you believe, then, should a fiscal stimulus play in mitigating the effects of this crisis and moving us towards a recovery? Trichet: I believe that the existing room for manoeuvre according to the Stability and Growth Pact rules can be fully utilised. And there is a great coherence between the provisions of the Stability and Growth Pact on the one hand, and what – at least speaking for the euro area – an attentive economic analysis would recommend on the other. Again we have to be mindful of the spreads on the various treasuries, and of the fact that the market is aware of the room for manoeuvre of the various countries. We also have to be mindful of the Ricardian effects which are very important.

That is the reason why we ourselves are telling all members of the euro area to respect the Stability and Growth Pact. It is the legal framework that we have as a quid pro quo for the fact that we do not have a federal budget and a federal government. And it is economically based on solid ground. Consider the spreads for the refinancing of the various government’s treasuries: they are taking into account the various fiscal policies. Consider the Ricardian effects, the level of confidence or the lack of confidence that you observe in the various constituencies of economic agents, particularly at the level of households: they suggest that there are certain situations where if you do not behave properly you might lose more in terms of confidence than what you are supposed to gain through the additional spending. We also say regularly to the various members of the euro area that they must be aware of the unit labour cost evolution, of the relative competitiveness of the various economies inside the euro area, and inside the single market of the 27 EU members. This is something which is also very important. FT: But of course the Stability and Growth Pact, thanks to the French government, 1997, is still very constricting. Trichet: It is supposed to function so as to prevent the various fiscal policies from loosening during the positive part of the business cycle in order to provide appropriate room for manoeuvre when we are in the downbeat episode of the business cycle.