samchain/econo-pairs-v1 huggingface dataset:
Yves Mersch: Post-trade harmonisation and financial market integration in Europe Closing remarks by Mr Yves Mersch, Member of the Executive Board of the European Central Bank, at the conference “Post-trade harmonisation and the integration of financial markets: a joint effort”, organised by the European Central Bank and the European Commission, Frankfurt am Main, 19 March 2013. *  *  *  Ladies and gentlemen, We have come to the end of today’s very intense programme. I now have the pleasure of sharing with you some thoughts on the main messages that have emerged in the course of today. Financial integration remains at the core of the European agenda. For the future of Europe, it is important that the Single Market project is taken forward with the full determination of all of us, even in times of difficulty. As President Mario Draghi remarked this morning, “in times of severe economic challenges, it is particularly important that our commitment to achieve a truly single European market is reaffirmed”. From the Eurosystem’s perspective, financial integration is of great importance. First, it is vital for the single monetary policy of the euro area: monetary policy is implemented through the financial system, which has to be as efficient as possible in order to guarantee a smooth and effective transmission of monetary policy impulses. A highly integrated financial system ensures that impulses diffuse homogeneously across the whole euro area. Second, financial integration has implications for the stability of markets. Integration results in increasing interconnections and cross-border activity.

For the day when this event will not only be our dream, but also our reality, the National Bank will continue to promote the fulfillment of its goals and tasks in accordance with European standards and best practices, which is of exceptional importance for the future the process of admission of the country into the membership of the European Union. Therefore, I assure you that we, the management and the employees of the National Bank, will be committed to this Project, we will openly and constructively cooperate during the implementation of all project activities, and use this opportunity provided by the European Union for further strengthening the capacity and credibility of our institution. At the end of my speech, let me wish the successful work of the project leaders and all the experts participating in the Project. I believe that after eight months we will be able to summarize a successfully completed Project, and in the period after that, after we have implemented the recommendations, we will write one of the many historical pages about the contribution of our institutions to the European integration processes of our country. Thank you! 2/2  BIS central bankers' speeches
Stability ultimately can be served only by the collective interaction of the three pillars of: •  sound leadership at the firm level;  •  effective market discipline;  •  and strong prudential regulation and supervision. Sound leadership at the firm level is the first bulwark against financial system instability, and begins with capable and experienced directors and management, a coherent strategy and business plan, and clear lines of responsibility and accountability. The execution of overall objectives must be supported by rigorous internal controls and effective risk management. The importance of a strong institutional credit culture cannot be stressed enough. The second line of defense is effective market discipline, an increasingly important ally of policymakers in a global marketplace. Of course, market discipline must be supported by substantial disclosure, sound accounting standards, and an efficient and credible legal framework. While effective bank-level management and meaningful market discipline are crucial elements of an overall strategy for promoting and preserving financial stability, neither can substitute for the critical  BIS Review 10/2001  3  role played by official supervision. The Basel Committee on Banking Supervision, which I chair, has identified the necessary ingredients of sound supervision, and these principles must be applied to all internationally active banks within a more dynamic, risk-based, and process-oriented framework. Strong regulation and supervision is a crucial part of achieving financial market stability and the proposed revisions to the International Capital Accord that were released in January by the Basel Committee will set the standard for banks around the world.

As with practically everything else, this assumption is associated with uncertainties that only the future can resolve. One of the biggest surprises of the coronavirus crisis concerns the property market. The memory of the post-GFC house price slump is still fresh in our minds. But we have seen nothing like that over the last year or so. The long-running rise in house prices has slowed but not gone into reverse. On the contrary, the property market has been boosted by soaring demand for housing in rural and mountain areas, fuelled by low interest rates. This is really not what an economy on its knees looks like. If we at the Czech National Bank erred in any of the forecasts we made in the dramatic days of last spring, when the pandemic struck with unforeseen force, it gives me some satisfaction to say that we were by no means alone. Obituary The coronavirus has sadly left a trail of economic, social and human devastation in its wake. Each of us no doubt knows someone who has been struck down by it. I’d like to take this opportunity to remember the well-known Czech economist Michal Mejstřík, who tragically lost his life to COVID-19 earlier this year. We always rightly admired Michal for his broad range of expertise, his intellectual curiosity and energy, and his ability to present interesting information and formulate fresh ideas.
In Europe, a series of initiatives, led by the authorities, are under way to revive the moribund securitization market but also to develop the private placements markets. On securitization, incidentally, allow me to note that it suffered unduly in Europe from the US experience, while having been much less prone to default. More generally, the European Commission’s Capital Markets Union project will support the increase in funding flows, the diversification of risks and a better allocation of resources. BIS central bankers’ speeches  1  This shift towards more market-based financing entails two main implications from a financial stability perspective: –  First, the proliferation of regulation brings uncertainty to market participants. The analysis of the cumulative impact and the interactions between regulations is still in its early days but it must be continued. Vigilance is indeed required to ensure that the implementation of reforms does not result in a reduction of activities that are vital for financing investments and firms. I notably think of the market-making activity which shows signs of decline, partly due to the regulatory costs. This decline needs to be monitored in a financial system where we are promoting market financing and where market making is key for issuers and investors. –  Second, the development of alternative sources of funding, outside the banking system, brings a necessary diversification. Yet the risks associated to disintermediation are clear, notably a limited assessment of risks by investors or less ability to address difficult situations and gaps in supervision.

First, its health-care system is competent in epidemiological management, more professional, and better equipped than that of most of its peers in the region. Proof of this is the high and growing volume of COVID-19 tests that have been applied, which make it possible to identify cases and isolate the sick or potentially infected. Second, Chile has accumulated economic buffers over the years thanks to financial and fiscal responsibility policies, and sound institutions to apply them. Thus, its space for fiscal, monetary, and financial policy making is also bigger than that of many countries. Third, its social protection system, despite imperfections, has the means to swiftly reach the lower-income households and workers risking their continuity in their jobs. At the same time, however, we must recognize our weaknesses, such as an important fraction of informal jobs, struggling productive sectors, and high uncertainty due to the social crisis that broke out last October. The risk that the institutional framework cannot bring new episodes of violence under control is a big concern in the country. The strength of our economic policy framework has been reflected in Chile’s rapid and forceful response to the spread of COVID-19 with measures to curtail and mitigate its economic impact. In the CBC, this has translated into more than ten measures adopted to boost the monetary stimulus, strengthen credit, and reduce financial volatility.
W A Wijewardena: John Exter – central banker for all times Article by Mr W A Wijewardena, Deputy Governor, Central Bank of Sri Lanka, on the first anniversary of the death of Mr John Exter (Founder Governor of the Central Bank of Ceylon/Sri Lanka), issued to Sri Lankan newspapers, 28 February 2007. *  *  *  The first death anniversary of John Exter, Founder Governor of the Central Bank, falls on 28th of February. He died in 2006 after living a very productive life for 95 long years. John Exter can be regarded as one of the history makers in modern Sri Lanka. He lent his wisdom, intellect and experience, without any reservation, for the establishment of the Central Bank of Ceylon, the name of the Bank at that time. The Bank was established in 1950 on the basis of the recommendations made by him as a one man committee, the report of which is now known as the Exter Report. He made history once again by becoming the governor of that maiden bank at the young age of 39, an age normally considered as too low for that prestigious and demanding position. His task was to establish the bank, staff it and lead it in the first few formative years, so that it could eventually be taken over by a Sri Lankan management. His history making did not end there.

I know of no sure way of predicting what will happen, but my personal view is that the internet is likely to emerge more as a channel to build on existing relationships and to increase the efficiency of basic services than as something which changes the landscape of the banking industry. But perhaps I am guilty of thinking that everyone else possesses the same inertia as I do when it comes to changing one's habits. Concluding remarks I have skimmed over a few issues which can rather loosely be said to fall under the heading of banking and development. There are many experts attending this symposium who will, I am sure, offer much deeper and more provocative insights into the economic outlook in general, and the relationship between financial development and growth in particular. I wish you all a fruitful and enjoyable couple of days. 4  BIS Review 59/2001
The result is a periodic tidal wave of credit during the boom followed by protracted credit drought during the crunch. Chuck Prince’s disco inferno causes murder on the dance floor. These credit cycle externalities provide a justification for state intervention to help co-ordinate lending expectations and actions by banks. At least in principle, these externalities suggest a role for the state in enforcing collective lending action, to curb the peaks and troughs in the credit cycle. The case for policy action may have grown over recent decades as competition in banking, and associated externalities, have intensified. Second, it has been suggested that one means of curbing credit cycle frictions is through monetary policy – either by ensuring it moderates appropriately the business cycle (Taylor (2010)) or, more ambitiously, by having it play a wider role in curtailing financial imbalances (Borio and White (2004)). The evidence presented here is not especially encouraging on that front. The frequency and amplitude of the business and credit cycles is quite different. Monetary policy may be an inefficient tool for calming the credit cycle, if at the same time it is to moderate the business cycle. Recent history offers a good case study. Between 2000 and 2007, UK nominal GDP growth exhibited no signs of exuberance, with GDP growth at trend and inflation at target. Over the same period, UK banks’ balance sheets trebled. Using monetary policy to tame credit growth over this period would have come at the expense of a destabilisation of non-financial activity.

They might actually boost risk-taking incentives among banks which are not subject to prudential intervention. BIS Review 168/2010  21  Chart 18 UK credit cycle across monetary regimes  (1) Gold Standard. (2) Inter-war suspension. (3) Resumption of Gold Standard. (4) Sterling Area. (5) Bank of England nationalised; Bretton Woods. (6) Bretton Woods; Sterling full external convertibility. (7) Monetary Targeting. (8) Exchange Rate Mechanism. (9) Inflation Targeting. (10) Bank of England independence. Source: Bank calculations. Chart 19 US credit cycle across monetary regimes  (1) Gold Standard. (2) Inter-war suspension. (3) Resumption of Gold Standard. (4) FDIC established; Federal Reserve reorganisation. (5) Bretton Woods. (6) Treasury-Federal Reserve Accord (1951). (7) End convertibility into gold (“Nixon Shock”) (1971). (8) Volker era. (9) Greenspan era. (10) Bernanke era. Source: Bank calculations. 22  BIS Review 168/2010  To see that, consider a two-bank variant of the model described by the payoffs in Table 4, in now references the market’s prior over the macro state, which it updates having which is neither too big nor too small, there are observed a bank’s earnings. When two symmetric Nash equilibrium strategies in this game: {Risky, Risky} and {Tight, Tight}. When Bank 1 sets {Risky}, Bank 2 does not want to set {Tight} and declare negative earnings as this is more likely to signal low ability, provided the long term costs are not too big. On the other hand, if Bank 1 sets {Tight}, Bank 2 sets tight too if long term costs are not too small.
The infrastructure that an e-krona would require could also be open to private agents willing to offer payment services linked to the e-krona. The Riksbank would cooperate with the market, both payment suppliers and fintech companies, when offering an e-krona to the general public. In this way, an e-krona system could also provide a platform that promotes competition and innovation. E-krona is a possibility Almost three months ago, the Riksbank published a first interim report which contains much of what I have talked about today. There is also a general description of how an e-krona might look. It should be available to all, banks, public authorities, companies and households. It should be possible to use it in real time, 24 hours a day and 365 days a year. It should be possible to use off-line, which means it could be used even where there is no access to a mobile network, for instance. Perhaps it could contain some element of anonymity, and perhaps it could be designed so that even groups who currently find digitalisation difficult to handle can easily use the e-krona. These are our initial thoughts and the reason why we published the report before we have thought it all through is that we want to have a dialogue with the market and other interested parties, as it is such a complex issue. The dialogues have now been initiated. We have already identified a number of questions that require further analysis.

SPEECH DATE:  08/12/2017  SPEAKER:  Governor of the Riksbank Stefan Ingves  VENUE:  Swedish House of Finance, Stockholm  SVERIGES RIKSBANK SE-103 37 Stockholm (Brunkebergstorg 11) Tel +46 8 787 00 00 Fax +46 8 21 05 31 registratorn@riksbank.se www.riksbank.se  Do we need an e-krona? Do we need digital cash – an e-krona as the Riksbank calls it? This is a question currently being analysed and subjected to lively debate in the central bank world. It is scarcely surprising that there is so much interest in this question, given that it covers all of a central bank’s areas of activity – the responsibility for a safe and efficient payment market, monetary policy and the task of maintaining financial stability. The question also touches on almost philosophical musings as to why the need for central banks arose once upon a time. What was then needed was a public institution that created a standard method of payment that the general public could rely on. Several centuries have passed since then, but the same need probably remains. This is why the Riksbank wants to investigate whether an e-krona could be the solution to provide the general public with continued access to central bank money even when Sweden has stopped using cash. Banknotes and coins abandoned Various agents in society are approaching the subject of digital money from slightly different perspectives.
The cost of building brick-and-mortar branches to outreach to rural users is high. Hence, the Bank developed the agent banking initiative to leverage on technology and deliver financial services to the rural groups in a low cost and scalable manner. It saves cost and the impact is enormous. Under the agent banking initiative, licensed financial institutions provide financial services to customers through third-party agents, such as retail outlets and post offices. Agents perform banking transactions such as deposit and withdrawal of funds in a safe manner using real time terminal technology i.e. Point-of-Sale (POS). Putting in place a mechanism to monitor performance is crucial to determine whether policy initiatives are effective. Just to give a flavour of what we have done, we actively track the coordinates of agent banks to ensure that access is provided to sub-districts in need of financial access points. Since its implementation in 2012, 95% of sub-districts now have at least one financial access point, a significant increase from 2011. As at August 2013, there were 5,661 agents and the total number of transactions has exceeded 25 million, with a total value of RM2.8 billion. Fourth, Islamic finance can play a huge role in financial inclusion given the strong parallels between the two The concept of financial inclusion – to develop a prosperous, egalitarian economy that contributes towards social development and social justice – is very much in line with the core principles of the Islamic economy, which place great emphasis on social justice, inclusive growth and equitable distribution of resources.

The figure set in month t, and for the following six months (t till (t+5) inclusive), is based on the forward price for the following year (t – (t+11)) observed between three and nine months earlier. The dotted line indicates prices relevant for the cap based on current futures contracts. Sources: Ofgem, Bloomberg Finance L.P. and Bank calculations. -1 -2  2016  2017  2018  2019  2020  2021  2022  Contributions to annual CPI inflation. Figures in parentheses are basket weights in 2021 and do not sum to 100 due to rounding. The chart was shown in the November MPR and does not include the latest data, for October 2021. Sources: Bloomberg Finance L.P., Department for Business, Energy and Industrial Strategy, ONS and Bank calculations. It would be wrong to say this inflation is only about energy. It’s broader than that. What we can say, however, is that most of it – thus far, at least – has been concentrated in tradable goods in general (non-energy as well as energy), much less of it in the non-traded parts of the economy. One indication of that is Chart 2, which plots the arithmetic contribution of various broad components to the change in the aggregate CPI in the UK. Just about the entire overshoot in overall inflation, relative to the MPC’s 2% target, reflects unusually rapid inflation in prices of (largely tradable) goods.
•  And when subsequently questioned by their superiors or regulators, they offered an array of self-justifications, chief of which is “everybody does it”. But everybody does not do it. I believe the vast majority of people working in the financial industry are committed to serving their clients or customers fairly and with integrity. But the unethical actions of a few have undermined trust and created instability. Reform of the financial industry will not be complete until this issue of trust and ethics is addressed. This requires “getting the culture right”. And by culture, I mean the shared values, attitudes and norms that guide actions. There is increasing international regulatory guidance to improve risk governance and align compensation schemes with long-term sustainability and customer interests. This is necessary but not sufficient. There are limits to what externally imposed rules can do to promote the right values in financial firms. •  Because culture develops from within a firm, it invites a certain resonance from the members of that firm – in a way that will be difficult for an externally imposed set of rules to achieve. •  For the same reason, the behavioural norms that a firm’s culture and value system promotes are more amenable to internal governance and self-policing than rules that rely on external enforcement. In short, rules tell us what we can do, but values tell us what we should do.

Vibrant economic research is needed to help us dealing with these challenges, notably in three key areas. The first relates to the economics and implications of blockchain and crypto-assets, and will be the topic of David Andolfatto’s keynote lecture and of the concluding panel discussion: What are the implications for the financial system in general, and for central banks in particular? Will Central banks’ monetary policy become less effective and, if so, are Central Bank Digital Currencies a way to restore their effectiveness? The second one, which will be addressed by several research papers today, relates to the financing of the economy: Do alternative and innovative ways to finance the economy (marketplace lending, ICOs, alternative scoring models) perform better than traditional financial intermediation without increasing the risks? What roles can incumbent banks play if financial services are to be driven by data? The third one is not on the agenda for today’s conference, but should be on the research agenda, relates to the use of artificial intelligence in finance: What would be the dynamics of financial markets if most participants were to rely on AI and machine learning techniques? How should regulation and supervision practices adapt to ensure that AI behaves in accordance with a financial and social optimum? Conclusion I would like to conclude my intervention by quoting Bill Gates himself: “We always overestimate the change that will occur in the next two years and underestimate the change that will occur in the next ten. Don’t let yourself be lulled into inaction”.