samchain/econo-pairs-v1 huggingface dataset:
We should also remember that the qualifying criteria for the AMA focus not just on the quantitative requirements for measuring operational risk, but also on qualitative standards that demonstrate banks have instituted a robust control structure. Institution-wide capital allocations A second theme from the consultations addressed the question of whether the AMA should allocate operational risk capital on a consolidated, institution-wide basis or rather on a legal entity basis. Most banks, and especially large and internationally active institutions, understandably would prefer to calculate the relevant capital requirements on a firm-wide basis. Banks shared a variety of views on why a firm-wide allocation model would be preferable. Some respondents highlighted the technical and logistical constraints on developing an AMA, indicating that it is more difficult, from a modelling perspective, to estimate the potential for operational losses at even a medium-sized entity because of the need for a large body of data. Others, including the RMA working group, noted the practical challenges that would arise if they were required to develop a separate model for each legal entity and seek approval from supervisors in each jurisdiction in which they operate. But an economic view of risk suggested a different and more fundamental concern. Many banks would like full recognition of the economic benefits they gain from operating across a diversified mix of business lines and entities.

This was no easy task, as the Committee received over 200 comment letters from the industry and the broader public on the Third Consultative Paper, or “CP3”. While we might have been somewhat surprised by the number of responses that we received, we were not surprised by the hard work that was evident in the letters. The quality of the responses shows that many banks and industry associations understand the deep significance of the proposals. On this note, I would like to offer the Committee’s appreciation to the RMA-related working groups and others who devoted considerable time and resources during the consultations. You shared important views through comment letters, gathered data for impact studies, and engaged in discussions like the ones that have taken place here. If you’ve been following our work since the first consultative paper was released in 1999, you know that the proposals have evolved and improved considerably thanks to the industry’s honest responses, candour, and letters such as those submitted by the RMA. At the Committee’s meeting, all members acknowledged our responsibility to consider carefully your concerns and those of the broader industry. At the same time, we recognised the need to resolve the open issues and release the New Accord as soon as humanly possible so that banks can continue to prepare for the new rules.
The Central Bank is thus able to gain valuable insights that contribute towards a more informed financial supervision, including in the design and implementation of macroprudential policy measures. The Central Bank is also best positioned to evaluate the tradeoffs should conflicting objectives arise. In such situations, a fragmented institutional arrangement frequently results in delays and compromises in policy responses. In addition, there would also be a lack of clarity of the accountability for the decisions. Finally, the Central Bank also performs a critical role in crisis containment and management, in particular, to provide liquidity, to prevent disruptions to the functioning of the financial system and to restore stability and confidence to the financial system. To avoid a piecemeal approach by any individual agency in the system and to ensure a comprehensive response to the financial crisis, the institutional arrangements for greater coordination across agencies is essential to allow for prompt action that may include a range of measures such as capital injections, debt guarantees and asset purchases in the effort to contain and manage the crisis. Regional roles At the regional level, the role of the Central Banks in East Asia has in this decade, transitioned to a new level of collaboration and cooperation.

For the Bank of Korea, the courageous policy responses to some of the very tough challenges presented during these episodes can be judged by the results that have been achieved. There is now a cause for optimism in the present circumstance. Korea is recognised as one of the economies that has been the fastest to recover from the crisis. The exceptional work by the Bank of Korea has been an important element in this unwavering resilience of the Korean economy. As the nature of globalisation changes and as financial innovation intensifies, the world has become more complex and less predictable. While the trend for greater trade orientation continues, changes in comparative advantage and shifts in the direction of global demand have transformed the trade patterns in the global economy. In addition, the financialisation of savings and the increased diversification of these funds into financial markets have increased the impact of these markets on the real economy as the performance of these markets experience booms and bust. The greater integration of financial markets across borders has also increased the potential for its effects to be rapidly transmitted from one financial system to another market in another part of the world. In this new environment, the greater interdependence arising from the stronger interlinkages between economies and financial systems have thus significantly raised the risk for contagion. At the same time, new economic growth centres have emerged that are shaping the economic and financial landscape of the world economy.
In banking, and given the crucial role this sector has still to play, we supervisory authorities have continued to stress that the use of capital buffers by banks is appropriate for recognising credit impairment and to continue providing solvent credit to households and firms. Banks will have sufficient time to comply once more with their capital requirements, and the start of the process will never be before the main effects of the pandemic have dissipated. In parallel, given the uncertainty still in place, and the fact that the impact of the pandemic has not been fully manifest on bank balance sheets and that they continue to benefit from various public support measures, we have recommended that banks act with extreme prudence in dividend distribution policies. In tandem, banks must pursue a policy of early recognition of impairment losses, ensuring that this is appropriate and timely, as stipulated in supervisory guidelines. Fiscal policy support in this phase should focus on the firms and population groups most affected. One particularly important aspect is the support to viable firms which, in light of the scale and duration of the crisis, have seen their solvency worsen. Should such solvency problems materialise, they would not only prompt destruction of the productive system and employment, in firms that could be viable in the post-pandemic scenario; they might also ultimately affect the financial position of the banking sector, which might respond with lending restrictions that would feed back negatively into the prospect of recovery and economic growth in the medium term.

In this regard, a comprehensive review of the industry-wide related issues involving payment instruments and systems needs to be undertaken to make Malaysia more competitive, with a view to promoting the more efficient payment systems and addressing the commercial hurdles. In order to further improve the growth and promote the e-payments, the payments industry may wish to consider establishing a Payment System Association to deal with the industry-wide issues involving electronic payments. A Payment System Association would be able to address the lack of common technology standards between service providers to promote interoperability, and the lack of a collective forum to identify, understand and manage the spectrum of stakeholders' interests and expectations. I should add that this idea is not new, as payment associations are already in existence in several other countries. Ladies and Gentlemen The future landscape of the payment industry is one that will continuously evolve with market innovations, resulting in enhanced services that offer improvement in efficiency and cost savings compared to traditional payment methods. Bank Negara Malaysia will continue to play the role of a facilitator to spearhead the development and improvement of the payments system infrastructure and to promote a conducive enabling environment for such developments to take place. In this respect, Bank Negara Malaysia has taken several initiatives to promote greater use of electronic payments by the public sector and in bringing about a mindset change amongst the users.
The imbalance within the economy which these figures reflect - notably the continuing imbalance between the internationally-exposed companies and sectors, which are having a really rough time, and the domestically-orientated sectors which are doing much better - is certainly not ideal. The continuing imbalance is not without risks. On the one side, we may find it increasingly difficult to offset the negative impact of the global slowdown in the face of increasing domestic private sector debt; and if the slowdown in the UK spreads beyond manufacturing to the services sectors it may cause unemployment to rise which in turn could slow the growth of consumer spending. But, on the other side, we may find it difficult to moderate the growth of domestic demand when the international environment improves. There is no doubt that if we could simply redraw the map, we would opt for stronger external demand and weaker consumption growth. That would represent a more sustainable balance within our economy. Sadly that is a choice that we are not immediately free to make. Doing what we can to encourage domestic demand growth to compensate for the global economic weakness is certainly preferable to an unnecessary slowdown in the economy as a whole. And that is the path we must for the time being continue to pursue. 2  BIS Review 85/2001  So what then are the prospects?

Ladies and Gentlemen: The profound changes in the global economic and financial environment, has created a greater urgency for the Southeast Asian markets to achieve a greater degree of financial integration. This is so as to provide the scale and increased efficiency of the financial intermediation process. As the ASEAN economies move towards the formation of an economic-bloc by 2015, the pace of financial integration will need to accelerate, to better facilitate achieving this goal. The wide spread distribution of innovative hybrid financial products and regional cross selling activities will however increase the multi-dimensional dynamics of the markets and the risks across national borders. There will be increased complexity in identifying the risks which will in turn complicate the process of risk management. The increasingly integrated and liberalised markets will also expose our porous economies to greater external influences and to contagion risks. A higher level of vigilance is thus required to allow for pre-emptive policy measures in a timely manner. This will require adequate levels of cooperation among the regional regulators in addressing potentially contagion systemic risks and ensuring regional financial stability. The deepening of co-operation between the Nusantara's monetary and regulatory authorities is thus a key factor in the development of a robust integrated platform. Enhanced cooperation will promote greater resilience and reduce regional vulnerability to external developments. There are now various regional mechanisms in place to undertake regional surveillance, to facilitate the exchange of information, to enter into greater engagement on issues affecting the region and in developing regional financial markets.
Faster clearing, especially with a balance check at initiation and immediate posting or credit at the receiving end could reduce the amount of credit involved in managing commerce or a payments business, credit that arises today from returned checks, for example. Customers that are relying more on their balances and less on float or credit may borrow less but may need to be more liquid. The possibility that future payments might rely somewhat less on a firm’s economic capital and its liquidity could also contribute to efficiency. Along with enabling innovation, technology drives new risk. Reports of denial of service attacks and data breaches have raised data security concerns across the payments industry. Concern is growing about the potential to corporate and or other bank account takeovers. Any of these disruptions has the potential for undermining confidence in the payments system, particularly given that it is difficult for end-users to assess the security of payment services. Security and resiliency have always been paramount concerns across the payments system. The impact of a significant outage or fraud on the public’s confidence may adversely impact increasingly electronic or “digital” commerce. New ways of making payments and the entry of non-traditional payments system participants create change that presents new risks and challenges to assess. The sophistication of some recent frauds introduces the potential for material risk.

End-to-end efficiency also means that innovation in payments origination and receipt integrates smoothly into demand account systems and traverses risk filters and the payments infrastructure with both speed and relatively low cost. We have ample room to increase efficiency. End-users are still writing paper checks by the billions across many different use cases. Some recent payment innovations are designed to address these opportunities. For example, in the P2P space there are PayPal, PopMoney and Dwolla; in B2B, Paymode X and PayNetExchange; for bill payment, FIS and Fiserv, and among the proliferating mobile options, Square Wallet and LevelUp. In many ways, however, checks continue to provide features that are not replicated by electronic alternatives and innovations. Checks offer a large measure of ubiquity. In other words, senders and receivers can reach nearly everyone without signing up for multiple services. They provide convenience because the payer doesn’t have to know the payee’s account information. Virtually all the innovative services I noted involve closed payment communities, which require both the sender and receiver to join. A more efficient mechanism would facilitate payments from any sender to any receiver. Achieved through directories, standards or some other solution, ubiquity will be key to achieving the efficiency of all-electronic payments in the end-to-end value chain. Let me touch on one more possible form of efficiency; in my personal view, an efficient, faster, secure and ubiquitous payments mechanism (especially if it’s mobile) could significantly change the risks in payments.
where the name of a merchant from the account statement does not coincide with the merchant’s trademark and thus hinders the identification of unauthorised payment transactions; 1  https://ec.europa.eu/info/publications/200924-digital-finance-proposals_en Directive (EU) 2015/2366 of the European Parliament and of the Council of 25 November 2015 on payment services in the internal market, amending Directives 2002/65/EC, 2009/110/EC and 2013/36/EU and Regulation (EU) No 1093/2010, and repealing Directive 2007/64/EC 2  1  - Unifying the regulatory regime applicable to electronic money institutions and payment institutions, by repealing the Electronic Money Directive3, and including issuance of electronic money as a new type of a payment service; - Standardisation of the application programming interfaces (APIs) used by the industry. Regulation of the concept of the so-called ‘open finances’- access to financial and non-financial institutions to a broad range of financial information regarding the customers with the latter’s consent with a view the provision of innovative services is expected to be proposed by mid-2022 building on the experience gained in the implementation of ‘open banking’; - Review of the services falling within the remit of the Directive. Presently, PSD2 does not cover services provided by ‘technical services providers’, who support the provision of payment services without coming into possession of the funds.

More recently, the balance sheet expansion has primarily reflected outright asset purchases and long-term lending schemes of unprecedented scale and duration, designed to deliver monetary stability when interest rates are close to zero. Other major countries have seen increases of similar scale: Chart 3 for example compares the expansion in the Bank’s balance sheet with that of the US Federal Reserve. These expansions, though primarily focused on maintaining monetary rather than financial stability, are arguably further examples of the central bank as firefighter: injecting liquidity when other market-based channels are blocked. Chart 4 shows how closely the increase in the size of the Bank’s balance sheet mirrors the decrease in the scale of sterling lending to households and firms by UK banks in recent years: a strikingly similar picture to the stylised relationship in Chart 1. 3  For a discussion, see for instance Ian Plenderleith’s Review of the Bank of England’s Provision of Emergency Liquidity Assistance in 2008–09 (http://www.bankofengland.co.uk/publications/Documents/news/2012/cr1plenderleith.pdf). 4 See John, S, Roberts, M and Weeken, O, ‘The Bank of England’s Special Liquidity Scheme’ (http://www.bankofengland.co.uk/publications/Documents/quarterlybulletin/qb120105.pdf ). 5  All speeches are available online at www.bankofengland.co.uk/speeches  5  Chart 4: UK central and commercial bank  Chart 5: Permanent shift in the Bank’s firefighter role?
), which have increased their exposure to risk transfer instruments, even though their investment policies remain fairly conservative. Third, banks themselves may, via credit derivatives, improve their risk management. They diversify their risk profiles by gaining exposure to companies or sectors in which they do not have customer relationships and by hedging risks while retaining customer relationships. Credit risk transfer mechanisms are also used by banks to deal with single-name concentration risk. Consequently, major improvements in risk measurement have been made. From a prudential viewpoint, the Basel II framework takes better account of risk mitigation techniques employed by banks, including the use of credit risk derivatives, and applies specific treatment to securitisation. BIS Review 33/2007  1  2. But this evolution should make us more – not less – vigilant regarding the assessment and tracking of risks. The wider benefits that CRT can bring should not give rise to a false sense of security. Risks do not disappear as a consequence of their transfer. Banks need to pay attention both to "residual risks" (e.g. tail or extreme event risks) and all of the risks (e.g. operational risk, documentation and settlement risk, legal risk) arising from the use of CRT. Furthermore, the growing complexity and volume of CRT transactions call for enhanced monitoring. Actually, understanding where risk ultimately lies and how risky exposures can build up is an essential prerequisite for safeguarding financial stability. The argument is fourfold: First, historically low interest rates and abundant liquidity have prompted an intense search for yield.

All indicators point to a general decline in confidence, both of consumers and investors. This decline is not unique to France; on the contrary, it is much stronger in our partner countries and particularly in the United States. Indicators, however, only provide information on the near future. Beyond one or two quarters, forecasts are based more on analysis, debate and judgement. In the present circumstances, this is particularly difficult. This is perhaps why, over the past few days, a current of opinion bordering on an intellectual vogue has prevailed, with a view that any banking crisis is bound to have far-reaching and long-lasting consequences. Along these lines, the optimists refer to the Swedish experience in the 1980s, which was marked by almost three years without economic growth, and the pessimists allude to Japan's "lost decade" following its banking crisis. However, a comparison is misleading. The situation today is profoundly different. First, as I have said, our banks, and particularly French banks, are financially sound. Furthermore, the reaction in terms of economic policy has been particularly rapid and vigorous.
In 1979, Compuserve opened up electronic mail to a rising community of personal computer users. In the same year, two graduate students at Duke University, Tom Truscott and Jim Ellis, developed Usenet, allowing users to post messages to (a precursor of) internet forums. By 1983, after more than a decade of evolutionary development, a universal Internet Protocol was agreed. This provided infrastructure and common technical standards for this evolving communications network. But the languages of the internet remained technical and diffuse. That meant it largely remained the domain of the nerds – libraries and universities. In March 1989, Tim Berners-Lee, a British software engineer working at CERN, the Geneva-based nuclear research lab, wrote a memo to his boss Mike Sendall.7 It was a suggestion for improving information management at CERN, replacing the silo-ed approach to information storage and search with a more interconnected approach. Sendall described the proposal as “vague but exciting”. A year on, Berners-Lee made his proposal less vague and more exciting. A paper with Robert Cailliau proposed the development of a World Wide Web, with links between and within documents creating a web-like information network.8 At the centre of this web was a  6  World Trade Organisation (2011). 7  Berners-Lee (1989). 8  Berners-Lee and Cailliau (1990). BIS central bankers’ speeches  3  common language – Hyper-Text Markup Language (HTML). This was a new lingua franca for computers, allowing them to communicate irrespective of their operating systems and underlying technologies.

Studies of the contributors to productivity growth since the 1960s indicate that the two top-performing sectors have been retail and wholesale.21 This is attributed to improvements in business processes in these sectors – the “Wal-Mart effect”. It is also attributed to wider and faster dissemination of innovation courtesy of new entrants. Economist W. Brian Arthur believes this digitised network of automated processes, linked by a common language, may have put the world on the cusp of a second industrial revolution.22 Arthur describes a “second economy” – the digital root system of the physical economy – and predicts it could become larger than the physical economy within a couple of decades. If so, those estimated benefits of a common language – in this case HTML and GS1 rather than Hindi and Mandarin – will need revising upwards. A. Common language for finance  Since the collapse of Lehman Brothers, the international financial policy community and the private financial sector has begun laying the foundations of their own second economy. A sequence of international initiatives, often led by the private sector, has taken us materially closer to constructing a global financial map. The co-ordinates of that map are defined by a fledgling global financial language. This global mapping effort is underpinned by two, mutually supporting, pillars: greater financial data to help forge links in the financial information chain and common standards for recording and aggregating these data. Progress on data collection has been material.