samchain/econo-pairs-v1 huggingface dataset:
The higher the debt-to-GDP ratio, the more difficult it becomes to take corrective action, especially during periods of slow economic growth. And the higher the debt ratio, the greater the risk of a situation where the debt dynamics become unsustainable, such as when the growth rate of the economy falls short of the interest rate paid on the debt. At the same time, structural reforms are not easy or popular to implement, especially during a slowdown or a recession. Structural measures include those that address the relative size and effectiveness of the public sector and those that promote competition in resource as well as in product markets. It takes time for these competitiveness-enhancing measures to reap the so-called macroeconomic dividends – including more rapid economic growth and faster employment growth. As a result, the rapid correction of the excessive debt ratio, as demanded by financial investors, often requires a sharp fiscal correction which leads to a slowdown in economic activity. In other words, the distress caused by austerity measures is relatively immediate, while the benefits need a longer period of time to materialize. One has to recognise that in the current circumstances, the pursuit of a lower deficit by financially stressed countries is inevitable and brings about a short term slowdown in the economy. The issue that arises is whether it would be possible to alleviate the negative effects on incomes and employment.

The European System of Financial Supervisors, which also includes the European Systemic Risk Board (the ESRB), is a new supervisory architecture requiring the National Supervisory Authorities to cooperate with the European Supervisory Authorities in the identification and analysis of systemic risks. The objective of the ESRB is to address one of the most important weaknesses identified during the financial crisis, as highlighted by the de Larosière Report – the lack of an adequate pan-European monitoring, assessment and mitigation of systemic risk. In line with the ESRB recommendation to enhance macro-prudential governance in each Member State, in the case of Malta, it is the intention to replace the current Standing Committee by a joint committee on financial stability. This committee, which will include representatives from the Central Bank of Malta and the Malta Financial Services Authority, would be mandated to monitor and assess risks to financial stability. Its objective is to formulate policy recommendations to the Boards of the two institutions, designed to safeguard financial stability, strengthen resilience of the financial system and minimise systemic risk. The recently announced changes to the Depositor Compensation scheme are a welcome change and help increase the resilience of the domestic banking sector. They are also in line with the recommendations of the latest IMF report.
If inflation undershoots the target at the same time as resource utilization is lower than normal, should it not be possible to keep the repo rate lower and thus have inflation closer to the target during the forecast period and more quickly return resource utilisation to a normal level? As I have described, I think there are fairly convincing reasons for the repo rate path described in the September Monetary Policy Update. The Swedish economy is strong and to attain the target a couple of years ahead we need only to start easing up on the accelerator. Because this is exactly what we are doing. The repo rate is being raised from an extremely low level and the repo rate path implies that we will have a negative real interest rate for a good time to come. This cannot be regarded as a contractionary policy – we are not slamming on the brakes. I have expressed some concern at recent meetings over what a lower repo rate path might entail. One view that I have put forward on several occasions is that monetary policy must manage risk. In this context it may be important not to treat the forecast period as separate and independent, but to try to take into account how decisions made now might affect developments beyond the forecast horizon. Of course it becomes more difficult to comment with any great certainty on what will happen the further ahead one tries to look.

CPI inflation was forecast to increase quickly next year, mainly as a result of mortgage rates rising due to the repo rate increases. CPI inflation was expected to temporarily overshoot the inflation target in 2012 and 2013, but to be around the 2 per cent target in the longer run when the repo rate has reached more normal levels. The majority of the Executive Board members made the assessment that it was appropriate to continue the process of normalizing monetary policy that had begun in the summer. The repo rate was raised to 0.75 per cent and the repo rate path was held unchanged from June. This is roughly the picture we painted in the Monetary Policy Update published in September. The statistics received recently have continued to point towards a rapid recovery in Sweden. The GDP outcome for the second quarter has been revised up relatively substantially compared with the preliminary outcome, and expressed as an annual percentage change amounts to 4.6 per cent. The National Institute of Economic Research’s economic tendency survey points to the mood among households and companies being much stronger than normal, and the indicator is now only marginally lower than the peak listing from 2000. New international statistics present a mixed picture. How the new information will be taken into account is something we will return to at our next monetary policy meeting.
A case in point is that a bank needs to have assets of at least $ billion to be eligible to establish a branch in Mainland China, which is at present beyond the reach of most local banks in Hong Kong. Future profits may also benefit from cost reductions arising from economies of scale – that is, the ability to spread fixed costs, including particularly those which are technology-related, over a larger scale of operations. Cost economies can also be achieved by eliminating duplications in branch networks, functions and staff. There may also be a reduction in risk, and therefore saving in costs, due to geographic or product diversification and the ability of larger institutions to invest in more sophisticated risk management systems. To the extent that risk reduction boosts a bank's credit rating, or increased size attracts the attention of investors, its cost of capital may be reduced, thus providing another means to increase shareholder value. Of course, merger is not the only way to maximise value. Nor, must it be said, is M&A always pursued for this reason. Management may have its own motives for chasing size - personal ambition or herd 1  "Consolidation in the Financial Sector": Group of Ten, January 2001, available at www.bis.org. BIS Review 49/2001  1  instinct may also be part of the story. This may help to explain one of the paradoxes of the consolidation boom.

Whatever the motivation, a series of transactions have recently taken place that show that the pace of consolidation is picking up in Hong Kong. Last year, for example, we saw the acquisition by Standard Chartered of the credit card and retail banking business of Chase Manhattan and the purchase by Bank of East Asia of First Pacific Bank. This year, Development Bank of Singapore is in the process of acquiring Dao Heng Bank with the intention of eventually combining it with its existing locally incorporated subsidiary. Two of the Mainland banks, Bank of China and ICBC, are also consolidating their Hong Kong operations. The Bank of China move is particularly significant since it will create the second largest banking group incorporated in Hong Kong. What we have not so far seen in Hong Kong is merger among indigenous banks that are more or less of equal footing. This is perhaps not surprising. Such mergers are generally more difficult to arrange than straightforward acquisitions of a smaller bank by a larger bank. In the latter case, the acquirer is in a position to decide what it wants to do as regards management and staff changes, harmonisation of systems and the introduction of new products. With a true merger, these matters have to be settled by consensus, which may not be easy. Who for example is going to be the chairman or chief executive? It is probably better to avoid the Japanese solution of sharing each of these responsibilities among more than one individual.
Recently published preliminary GDP figures for the first quarter also show that growth continued to fall, although the rate of the fall slowed down. My main emphasis was on what lies ahead of us – the economic cycle further on this year and into 2010. I shall not repeat everything I said at our two most recent monetary policy meetings; anyone who is interested can read the minutes of the meetings. But I would like to take the opportunity to bring up some of the views I expressed then. One view that I wished to highlight concerned the housing market in the United States, which is in many ways the origin of the problems. Some signs of stabilisation are now visible there, although some quarters of adjustment still remain before the stocks of unsold houses have been reduced and house prices stop falling. Falling housing investment has provided large negative contributions to growth in recent years. Very little housing has been built for several years now in relation to the increase in the number of households. When the turnaround comes, housing investment should provide a good contribution to growth. I also mentioned that stocks in the United States have been phased out rapidly and they will sooner or later be down to levels where the demand flow, even if it is declining, will need to be met with increased production. However, here one must bear in mind that this “cyclical” upturn will be temporary if final demand does not catch on further ahead.

Now the Swedish financial markets were also hard hit and some sub-markets were practically at a standstill. The earlier expectations that the decline in economic activity would be fairly mild were replaced by a much more negative view of future developments, both in Sweden and abroad. The Lehman Brothers crisis was also the prelude to a series of measures to stabilise the Swedish financial markets. At the same time the Riksbank took several rapid and resolute steps down the interest ladder to alleviate the effects of the crisis on economic activity. Still sensitive but liquidity risk has declined The first phase of the crisis can be described as a liquidity and confidence crisis. No one trusted anyone else and very few were willing to lend money and take risks. The price of loans between the banks, interbank rates, also rose sharply. Since the crisis started the central banks have lent large amounts to the banks. For example, the Riksbank has offered loans in Swedish kronor at longer maturities than normal to facilitate the supply of liquidity to the Swedish banks. We have also lent US dollars to Swedish banks and we have made the collateral requirements for the loans somewhat more generous. The government has tried to reduce the banks’ liquidity risks through its guarantee programme, which basically involves banks and other credit institutions being able to sign contracts with the government on guarantees for some of their borrowing.
However, bail-in is not yet a well-defined concept in the international policy discussion; I’m not sure how my description of a mechanism resonates with the overall discussion. Right now, the common theme of a set of bail-in concepts is putting in place a statutory or contractual trigger that would convert a firm's debt into equity, thereby immediately strengthening the firm's capital base. Short-term debt and liabilities would likely be excluded. To move the bail-in mechanism from concept to a meaningful proposal, the official community needs to develop one or more specific proposals that can be vetted, debated and improved. In that spirit, let me list some areas in which a bail-in proposal needs to be more specific. A proposal needs to make clear:   The nature of the trigger. Is it contractual or supervisory? Is it rule-based and if supervisory, rule-based or discretionary? 6  BIS Review 140/2010    The desired capital structure before a bail-in. Consonant with the work in Basel on capital and liquidity requirements, how much bail-in eligible debt should the firm have? To answer that requires specifying goals for the capital structure of the restructured firm. It is probably crucial that the post-bail-in capital structure provide enough loss-bearing capacity to make regeneration of the company's prospects credible.   Estimates of the market capacity to purchase bail-in eligible instruments relative to the amounts of such instruments that would be needed and the price sensitivity of markets to volume and financial institution credit quality.

A supervisory innovation: recovery planning The potential for rapid decay of asset and business line values unless assets and liabilities are transferred to a permanent owner quickly is a large part of what sets financial institutions apart from other companies entering insolvency. This difference motivates efforts to avert insolvency through supervisory action, as I described earlier. It also motivated U.S. banking supervisors in the early 1990s to ask some troubled banking companies not only to apply the three-part program but also to develop a meaningful contingency plan for reducing risk and raising capital if the first round of actions did not succeed. The supervisors incorporated the requirement to develop contingency plans in its supervisory agreements with those institutions. 2  BIS Review 140/2010  The CBRG has recommended that all systemically important financial institutions develop recovery plans. I believe the development of such plans by healthy institutions and their discussion by a college of the firm’s principal regulators constitute important innovations in the supervision of financial institutions. The Cross Border Crisis Management Group has provided momentum and a forum for discussion of progress and challenges as supervisors initiate discussion of recovery plans with firms. The discussions we have held in the United States involve the financial institution, its major U.S. regulators and the regulators of the foreign legal entities containing its principal business operations.
News conference  Berne, 13 June 2019 Fritz Zurbrügg  Introductory remarks by Fritz Zurbrügg  In my remarks today, I will present the key findings from this year’s Financial Stability Report, published by the Swiss National Bank this morning. In the first part of my speech, I will talk about the big banks, before going on, in the second part, to outline our assessment of the situation at the domestically focused banks. Big banks  The global economic and financial market conditions that the two Swiss big banks are facing have become slightly more difficult since our assessment this time last year. Nevertheless, further progress has been achieved in implementing the revised ‘too big to fail’ regulations. This holds true for both areas covered by the regulations: resilience and resolution. As regards resilience, the Swiss big banks Credit Suisse and UBS have slightly improved their capital situation overall. As a result, they are now close to full compliance with the lookthrough going-concern capital requirements on a consolidated basis. The current calibration of these regulatory requirements is necessary to ensure adequate resilience at both banks. This is confirmed by both our loss potential analyses and the historical loss experience during the last financial crisis. The market’s assessment of the two big banks’ resilience is generally similar to that of the previous year. Their stand-alone ratings, which evaluate the intrinsic financial strength of the banks, assuming no extraordinary external support, remain unchanged.

Gent Sejko: Albania's economic and financial developments in 2019 Speech by Mr Gent Sejko, Governor of the Bank of Albania, during the presentation of the Annual Report of the Bank of Albania for 2019 in the Albanian Parliament, Tirana, 2 July 2020. * * *  Honorable Mr. Speaker of the Assembly, Distinguished Ladies and Gentlemen, Let me thank you for the invitation and the opportunity you have given me to present to you the Annual Report of the Bank of Albania for 2019. In general, I find that the work of the Bank of Albania has had a positive contribution to strengthening the monetary and financial stability of the country. This stability is a necessary precondition for the sustainable and long-term development of the country. Also, the Bank of Albania has fulfilled its other legal duties, has made progress in the implementation of the Medium Term Development Strategy, and has implemented the recommendations left by the Albanian Parliament. *** In accordance with the legal framework in force, the main objective of the work of the Bank of Albania is to achieve and maintain price stability. 1. Albanian economy and monetary policy during 2019 2019 was a challenging year for the Albanian economy. Economic activity continued to benefit from rising private consumption and the rapid expansion of tourism. However, the foreign environment proved to be unfavorable, while the decline in electricity production, the gradual termination of investments in major energy projects, and the November earthquake had strong negative effects.
From an operational perspective, over the second half of last year, the Bank of Albania took a number of measures: •  strengthening the surveillance of financial market developments, and in particular of the banking sector;  •  strengthening bilateral and multilateral meetings with bank representatives, asking them for increased vigilance due to current international market conditions;  •  increasing contacts with other domestic institutions that regulate and monitor the financial markets, in particular with the Authority of Financial Market Supervision;  •  increasing the number of publications, including the Financial Stability Report 2007 (Sept.) and the Statement on Financial Stability (Oct.), which try to analyze the  2  BIS Review 43/2009  elements of the crisis and its potential effects on Albanian Banking Sector and the economy; •  increasing the presence in the Media, to explain the crisis, to clarify the position of our banking sector toward the potential crisis effects, and to maintain public confidence in the banking sector;  •  changing and improving the reporting framework of banks, in particular regarding their exposure to international markets (and the mother-banks) and their liabilities (deposits and exposure to credit lines) from mother-banks);  •  reviewing our “back-up” plans to assess the possibility of new actions, should we encounter a worsening scenario;  •  changing the form of our open market operations and starting to execute “open amount/fixed price” weekly reverse repurchase transactions and longer maturity ones, to better suit the liquidity needs of the banks.

Hence, the banking sector relies heavily in domestic deposits, both in national and foreign currencies, to perform its lending activity. The foreign currency position of the banking sector is quite balanced, as assets and liabilities in foreign currency stand respectively at around 49 percent of total assets, and liabilities of the banking sector to nonresidents (almost entirely in foreign currency) is only 10 percent of total liabilities. The banking sector is well-capitalized and liquid. The capital adequacy ratio stands at around 17 percent, compared to the required minimum of 12 percent. Liquid assets to total assets, is at around 43 percent. In the last 4 years, the average return on equity has been above 20 percent while the average return on assets has been around 1.5 percent. The branch network of the sector counts around 350 branches all over the country. In the last three years mainly, the banking sector has also introduced modern payment infrastructure and products, to allow for increasing usage of electronic payment cards and internet banking. Despite solid performance in the last years the Bank of Albania has been vigilant to point out areas of the banking activity, related with domestic developments that required attention from the banking industry. Until before the appearance of this international financial crisis, we have expressed our concern regarding the rapid increase in lending which, until 2007 reached up to 8-9 percentage points in terms of annual growth to GDP.
1/5  BIS central bankers' speeches  Take the case of a vendor that provides critical services and is on the brink of bankruptcy. Are credit risk analysts, operational risk and business continuity professionals, and the business affected working together to share information, insights, and potential responses? Or, are silos preventing information from getting to the right people at the right time to prepare and act? Risk silos can result in siloed decisions, and looking at risks one by one is incoherent. We could drive operational risk to zero by having no operations (I guess we can all go home early), but then strategic risk rises to infinity. Since most meaningful decisions involve balancing risks, to get to the right decision, we need a risk picture that covers all relevant risk types and engages all relevant risk experts. Similarly, real world vulnerabilities do not have to conform themselves to a particular risk type. Think about weaknesses in identity and access management. This is a driver for risks ranging from cyber, to compliance, to operations, and more. This is also a type of risk that can’t be mitigated solely through technical controls put in place by information security experts; that is, a siloed risk response is insufficient. So, stronger collaboration and coordination across risk disciplines is one solution to the negative effects of risk silos. Another specific pain point created by risk silos is the flourishing, and perhaps overgrowth, of risk assessments. Most organizations have many risk reviews: often a different review for each type of risk.

Some focus on assets, others focus on organizational units, and yet others look at specific parts of processes. The result can be a set of assessments with potentially inconsistent coverage and disconnected recommendations. So, an appealing alternative to counter that trend and bridge siloed assessments is to integrate risk assessments. A unified approach can bring together risk and business professionals to understand and manage the risks to critical processes. The idea is to create a common picture of gaps and then design coordinated action plans that can target improvements in resilience. Let’s focus on business continuity to see how an integrated risk approach can strengthen resilience.5 Business continuity programs have traditionally been designed to restore critical physical or technology infrastructures that can be disrupted by threats like extreme weather or loss of power. So, a business continuity plan might involve arranging for a backup data center if the primary data center goes down due to a hurricane. Within an organization, different business areas may develop their own plans that are focused on their specific business needs and priorities. An integrated business continuity plan is one that is designed to protect critical organizational processes and their essential assets from the full range of relevant threats. An integrated approach begins with organizational objectives. This bridges a gap between what good looks like to an individual business and what it looks like to the organization as a whole.