samchain/econo-pairs-v1 huggingface dataset:
While there may be differences in the operational arrangements and in the nature of activities undertaken by global players in emerging markets in Asia and Latin America, the significance of their presence in the financial systems in both regions makes this dialogue session most relevant and timely. In Malaysia, foreign banks' account for almost 30% of the total assets of the banking industry. In the context of cross-border banking, the local incorporation of all foreign-owned banking institutions' branches in 1994 has contributed towards the strengthening of Bank Negara Malaysia's supervisory oversight over the activities of foreign-owned banking institutions in Malaysia. The capital and resources dedicated to support the domestic subsidiary operations reflects the commitment of the foreign-owned banking institutions in the country. In addition, it has also facilitated the assessment of the financial soundness of local operations of foreign banks. While the merits of different operational arrangements are a matter of much debate, particularly in terms of business flexibility, the subsidiary structure of foreign-owned banking institutions in Malaysia has facilitated the consistent application of rules and regulations by Bank Negara Malaysia to the entire banking system. The increasing significance of the foreign institutions, along with the different operational structures were key factors that influenced the design of the early cross-border supervisory framework. This is detailed in the Basel Concordat, that outlined the principles for supervision of foreign banks by home and host authorities, issued by the Basel Committee of Banking Supervisors (BCBS) in 1983.

Basel II is only one component of prudential regulation, and hence must not be viewed in isolation. In this context, the suitability of other rules such as the provisioning framework and the stress testing practices must also be discussed with a view for future enhancements. Ladies and gentlemen, While we engage in the intricacies of implementing Basel II we should not loose sight of the ultimate objective of maintaining financial stability. This dialogue is most important in providing a forum for the exchange of views and the sharing of experiences. Indeed, the outcome of the discussions should be escalated to a higher level of policy deliberation so as to further accelerate the progress in detailing the issues relating to the cross-border implementation of Basel II. On that note, I wish all of you for a stimulating and productive discussion. Thank you.
As a takeaway, when you think about the Fintech 2025 strategy, I want you to envision a virtuous cycle. 42. As all banks adopt fintech to capture new opportunities in the digital economy, strong demands will be created for fintech talent, data infrastructure, new payment instruments, and supportive policies. Our strategy will meet all these demands, in turn reinforcing fintech adoption, and ultimately catalysing the growth of a healthy fintech ecosystem that benefits both banks and customers. 43. Back in 2017, when the HKMA announced the seven smart banking initiatives, they were well received, though not everyone could tell their significance and the changes they could bring. Today, nobody will question the impact of, for example, the FPS and virtual banks, on your business and our daily lives. 44. I believe the same could be said for Fintech 2025. This new, forward-thinking strategy will set the scene for important fintech developments to take place in the coming years. I urge you to join us and take our city’s fintech ecosystem to new heights. 45. Thank you. 5/5  BIS central bankers' speeches

In addition, there is still room for improvement, particularly when it is noted that Spain continues to be the EU country with the highest density of branches per head of population. And this does not seem to be very compatible with the technological innovation I have been talking about, whose introduction permits a lesser physical presence. Banks must adapt to the new environment and continue the orderly correction of excess capacity carried out in recent years. The increases in efficiency required could lead to some further consolidation within the sector. 7/8  Finally, as I said at the start, I cannot finish without reminding you of the need to maintain the confidence of bank customers, the most important and also the most fragile asset of the business of deposit institutions. In my first public address as Deputy Governor I mentioned aspects that could be improved. The Banco de España is strengthening its supervisory activities in relation to the conduct of banks. The priority must be the customer, as this is the only way to maintain confidence in the sound functioning of the Spanish banking system. Thank you very much for your attention. 8/8
The MPC will be able to make its own assessment of the impact on demand and inflation of the Growth Plan during its next forecast round leading up to its next decision meeting on 2 November. Based on what we know so far, these impacts are likely to be material for the economic outlook over the next three years, which is also the horizon relevant for monetary policy. The final shock I want to talk about is the recent turbulence in financial markets. The MPC’s forecasts are conditioned on assumptions for the outlook for various asset prices and so these movements could have a significant direct effect on the November forecasts and for the Committee’s broader assessment of financial conditions. Financial markets globally have been volatile over recent months, with notable rises in government bond yields, large moves in exchange rates and falls in risky asset prices. Overall the adjustment in market prices has been consistent with tighter monetary policy globally and the deterioration in the economic outlook. These trends were more marked for the UK through August and up to the September MPC meeting. But the UK began to really stand out over the last fortnight, which has seen significant moves in the pricing of UK financial assets. Part of that re-pricing continues to reflect broader global developments. But there is undoubtedly a UK-specific component.

There are, of course, many criticisms one could make of the specific inadequacies of the fiscal support that has been provided and the timing of the various measures. Nonetheless, it is fair to say that fiscal policy has fulfilled its stabilisation role in the Czech Republic and elsewhere during the crisis. Inflation has surprised us quite significantly during the Covid crisis. Shortly after the pandemic broke out, we at the CNB cut our interest rate in three steps almost to zero in order to reduce the expected demand slump at least partially. At the time we were worried that inflation would fall quickly and sharply, as it has done in past crises. Our decision was guided largely by economic intuition, because it is extremely difficult to draw up quantitatively reliable forecasts at critical junctures under large and complex uncertainties. In the year since the crisis erupted, inflation has declined from above the upper boundary of our inflation target to close to the target, but that’s about all. Looking back, we can see two main reasons why inflation did not fall significantly lower. The first is that our economy was strongly overheated before the coronavirus crisis and the crisis merely tempered the overheating. Unfortunately, I have to admit that if we’d been better able to estimate future inflation in 2019 and had not been so unsettled by the risks associated with Brexit and trade wars, we’d have taken interest rates higher at that time.
While that diversity should be welcome – it should be a source of strength – it can be a source of weakness if it simply moves gearing into a shadow on our radar screen. It’s essential that our radar technology keeps up. The Bank’s Commercial Property Forum, ably chaired by Ian Marcus, helps us minimise the shadow on the screen. But we also want systematic data. That’s why I welcome the efforts of your industry, in partnership with us, to build a database of CRE loans: a dataset that will be run and managed for the public good, while respecting commercial confidentiality. It can give you, and us, the information we need to manage the risk of loosening underwriting standards. Long-term valuations But still more is needed to nurture a resilient market environment. You can become overgeared without technical slipping of underwriting standards. We’ve seen in the past how a change in sentiment can drive commercial property prices up even without the prospect of improvement in the cashflows which the property will generate. That creates headroom for those already in the market to borrow more without breaching their loan-to-value standards. And the use of that headroom drives prices up further. An ultimately pernicious spiral of sentiment and debt begins. Valuations and debt increase sharply relative to the cashflows that support them. When the music stops, the process goes into sudden reverse. As valuations fall, borrowers are left struggling to service loans that are greater than the value of the property. Firesales begin. Sentiment deteriorates.

However, in the case of improving the supply of jobs in Spain, there must be an urgent recognition of our  BIS central bankers’ speeches  3  problems by all, and reform measures should be adopted as soon as possible. From December to March the markets acknowledged the last two measures adopted in the fiscal and financial field, namely pension reform and the Royal Decree-Law on recapitalisation. Yet the figures of more than 20% for total unemployment and of around 40% for youth unemployment continue to appear on all market screens, figures that investors consider to be a sign of inability to promptly attain close to potential growth. We have to change the institutional and legal framework of employment not because the markets demand it, but because it is in our interest. All citizens want lower unemployment rates and higher wages in those industries or companies where productivity is growing more. But we must also be aware that if the obstacles to job creation are not lifted, the markets will ultimately perceive that the only way Spain can recover competitiveness within the Monetary Union will be by maintaining very low GDP growth rates over many years, as has occurred in other countries. The solution to fiscal problems, no matter how appropriate the policies adopted are, will be much more complicated if public revenue is poor or if we carry on spending 3% of GDP on transfers to the unemployed for any length of time.
As a life-long central banker, I’m sure Governor Glenn Stevens can give us the broader perspective on this issue. 4. I sincerely hope that the common lessons learned from our experiences within the region will help us, and indeed other central banks, better manage the complexities of the global economy. 5. Before we hear from Governor Stevens, I wish to take this opportunity to thank all guests for joining us at this Policy Forum to mark the 70th anniversary of the Bank of Thailand. Many of you here have been an integral part of our policy progress over the past many years. On this note, may I propose a toast of appreciation to all of you and of hope that many of you will continue to support a common vision toward building further policy progress for the well-being of all Thais in years to come. 6. Thank you. BIS central bankers’ speeches  1

“You are not here to tell us what to do, but to explain why we have done it” is the way Norman rebuked the Bank’s Chief Economist of the day.8  5  Roberts, Reading and Skene (2009). 6  John, Roberts and Weeken (2012). 7  Boyle (1968) p105. 8  Ahamed (2009) p233. 4  BIS central bankers’ speeches  Norman saw the Bank’s role in expansive terms, as provider not just of emergency help but as builder of infrastructure and supporter of industry. The Bank became part of the post-war reconstruction effort. Having spent 200 years tending to its back garden, the Bank began to explore pastures new. To take one example, in 1928 the Lancashire cotton industry was on its knees. These problems risked ricocheting back to the financial system, with at least two of the big five UK banks up to their neck in cotton.9 A plan was conceived involving consolidating the industry into a Lancashire Textile Corporation. This was to be financed with debt and shares issued and supported by – you’ve guessed it – the Bank of England. It was a bold and cunning plan. Unfortunately, it flopped. The share issue by the Corporation in 1931 was a resounding failure, leaving the underwriter with a large chunk of the shares. The Bank ended up having to support the market.10 It, too, found itself up to its neck in cotton. Undaunted, the stage had nonetheless been set for the Bank’s on-going involvement in financial infrastructure.
Over the years, SME customers have gained a more prominent standing in the books of banking institutions in Malaysia. Consequently, it is in the banking institutions' best interest to meet the requirements of viable SME customers, which may face difficulties in the current challenging environment. Banking institutions need to engage and regularly interface with the various associations that represent SMEs to ascertain and formulate solutions to address issues confronting the SMEs while also communicating the requirements expected of the SMEs. Banks also need to provide greater flexibility in structuring the financing facility including customisation of the repayment periods within acceptable risk management levels. Banks may also expand the provision of advisory services to SMEs and proactively seek out SME customers that may be facing stress in this difficult business environment well before their conditions deteriorate. Adequate advice on financial management could pre-empt and avoid problems with respect to the financing facility. Bank Negara Malaysia has also advocated for the migration to electronic payments as a measure to improve efficiency levels. This cannot be overemphasised in the current environment. The adoption of electronic means of payments would result in greater business efficiency in addition to reducing the cost of doing business. It is important for the businesses including the SMEs to place high priority on the adoption of more expedient and efficient means of payments.

8 See Anderton, R., Aranki, T., Bonthuis, B. and Jarvis, V. (2014), “Disaggregating Okun’s law − Decomposing the  impact of the expenditure components of GDP on euro area unemployment”, Working Paper Series, No 1747, ECB, December. 9 5/6  BIS central bankers' speeches  9 The fiscal stance is measured as the change in the cyclically adjusted primary balance net of government  assistance to the financial sector. 10 See Knotek, E. S. and Zaman, S. (2014), “On the Relationships between Wages, Prices, and Economic Activity”,  Economic Commentary, August; Bidder, R. (2015), “Are Wages Useful in Forecasting Price Inflation?”, FRBSF Economic Letter. 11 Bobeica, E., Ciccarelli, M. and Vansteenkiste, I. (2019), “The link between labor cost and price inflation in the  euro area”, Working Paper Series, No 2235, ECB, February. 12 Bobeica et al., op. cit. 13 See Head, A., Kumar, A., and Lapham, B. (2010), “Market Power, Price Adjustment, and Inflation”, International  Economic Review, 51(1):73–98; and Taylor, J. (2000), “Low Inflation, Pass-Through and the Pricing Power of Firms”, European Economic Review, 44:1389–1408. 14 Bobeica et al., op. cit. 15 See Hahn, E. and O’Brien, D. (2018), “Monitoring the exchange rate pass through to inflation”, Box 3 in Economic  Bulletin, Issue 4, ECB. 16 See Koester, G. and Guillochon, J. (2018), “Recent developments in the wage drift in the euro area”, Economic  Bulletin, Issue 8, ECB. 17 Andersson, M., Kok, C., Mirza, H., More, C. and Mosthaf, J.
reinvestment of earnings) + capital account balance ***) 4-quarter cumulative data  -6  2009  2017 Q3***  2016  2015  2014  2013  2012  2011  2010  2009  2008  2007  2005  -25  2006  direct investment, equity (incl. reinvestment of earnings) capital account balance* non-debt-creating capital flows** current account balance  -20  2013-2015 at MTO  2007  -15  -30  percent of GDP  2013  percent of nominal GDP  2008  10  Figure 25. General government structural deficit  f) forecast Source: ECB, Eurostat 18  Figure 26. Households' total debt* 140  lei bn. 120 100 80 60 40 20  consumer loans – banks housing loans – banks write-offs  consumer loans – NBFIs housing loans – NBFIs  Jun.17  Dec.16  Jun.16  Dec.15  Jun.15  Dec.14  Jun.14  Dec.13  Jun.13  Dec.12  Jun.12  Dec.11  Jun.11  Dec.10  Jun.10  Dec.09  Jun.09  Dec.08  Jun.08  Dec.07  Jun.07  0  stock of sold consumer loans stock of sold housing loans  *) the stock of sold loans refers only to sold loans for which the bank continues to provide management services Source: NBR  19  Figure 27.

The main risk factors to financial stability are: (i) the undercapitalisation of a large number of companies (276.4 thousand firms with net worth below the required threshold, out of which 268.5 thousand firms with negative equity), induced particularly by losses (217.3 thousand firms with total losses of lei 33 billion in 2016), as well as the high indebtedness level in certain sectors, (ii) the increase in past due obligations to the government budget (up 5.9 percent in 2016), (iii) the low capacity to recover commercial claims, especially at the level of micro-enterprises, (iv) corroborated by the large number of firms in credit institutions’ portfolio which have not gone through a full business cycle, (v) the return of insolvency to an upward trend in terms of both the number of newly-insolvent firms (6.1 thousand firms in the first eight months of the year) and the volume of non-performing loans generated in the banking sector (the volume of non-performing loans generated by the companies undergoing insolvency proceedings increased by about one third to lei 1 billion) and (vi) the rise in overdue payments of the government budget to the real sector (up 9 percent in the period from September 2016 to September 2017 to lei 223.1 million). In a broader perspective, the weak payment discipline economy-wide has highlighted structural vulnerabilities in the balance sheets of companies (Figures 31-34). It is worth noting that the poor payment discipline economy-wide is not a new risk, but a recurrent vulnerability in Romania’s economy.
Neither is it possible for anyone to say how soon after 2021 a downturn may occur. It could come soon after, or some years later. 4 Now 0.5–0.75 per cent is not a particularly high level for the repo rate, if one looks at it from an historical point of view. But on the other hand, history may not be as informative in this case as there has been a downward trend in global real interest rates in recent decades, as I just pointed out. It is therefore difficult to know what is currently a neutral, “normal” level for the repo rate. What one can say with some certainty is that it is much lower than it was 10–15 years ago. But even taking this into account, a repo rate of 0.5–0.75 per cent does not appear particularly high if an economic downturn were to occur in early 2021. How much is the interest rate usually cut in economic downturns? In Sweden, it is not so easy to have a clear idea of this as we have had a floating exchange rate and an inflation target for just over 25 years, and that is not long enough to have experienced so many economic cycles. It is only when the exchange rate floats that one can use the policy rate to counteract economic downturns – when the exchange rate is fixed the policy rate is in principle locked on defending the chosen exchange rate.

The fact that monetary policy decisions are often taken by a committee is a complicating circumstance in this context. 15 See for instance Alsterlind et al. (2015) for a more detailed description. 16 See, for instance, Weale and Wiedalek (2016) and De Rezende (2017). 17 See the article “The Riksbank’s strategy for a gradual normalisation of monetary policy” in Sveriges Riksbank (2017b). 8 [24]  also tries to affect credit risk-free interest rates, via the premium channel, although these are interest rates with both short and long maturities. 18 Despite the measure being termed “unconventional”, one can say that this type of monetary policy intervention followed a standard way of thinking in that one limits oneself to trying to have an effect on risk-free interest rates, the “ground plate” for interest rate setting in the economy. The idea is, as when adjusting the repo rate, that the effects will spread to other, higher risk interest rates. However, it is of course also possible, although the Riksbank has not yet done so, to buy other financial assets than government bonds. The Federal Reserve, the European Central Bank, the Bank of England and the Bank of Japan, for instance, have also purchased different types of commercial securities, including mortgage bonds and corporate bonds. Unlike purchases of government securities, this often entails a direct intervention in higher-risk assets.
Rapid trade liberalisation across Asia has improved market access. Rising incomes in the Asian region where more than half of the world population resides has generated a huge cumulative market. This increase in consumption demand has led to the development of an extensive modern retail sector across the region. Supported by stronger economic fundamentals, emerging economies are expected to grow at higher rates over the next five years compared to the period prior to the crisis in 2000 to 2008. The IMF projects that emerging economies in Latin America, the Middle East, Africa and Asia will, on the average, grow by 6.1% in the period 2010–2014, higher than compared to the period 2000–2009. Asia’s prospects during this period will be sustained by several structural factors. First, Asia has a favourable demographic structure with a relatively young population with a higher propensity to consume. The high savings rate in Asia also allows for higher consumption demand with more than adequate surplus to finance the required investments activity. In addition, financial intermediation in Asia is progressively deepening to meet the new financing needs of households and businesses. In this more recent decade, greater financial integration is taking place. This financial integration will result in a more efficient recycling of Asian savings into investments within Asia. It has been estimated that Asia needs to invest about USD 8 trillion in infrastructure development over the next ten years.

It has also opened up the prospects for developed economies to forge stronger financial linkages with these dynamic growth regions of Asia and the Middle East. Islamic finance is well positioned to be a vehicle on the New Silk Road as the enabling supporting infrastructure is already in place. The required regulatory and legal frameworks for Islamic finance have also been established, not only growing in a number of countries in Asia and the Middle East, but also at the international level. It was with the establishment of the prudential standard-setting body, the IFSB in 2002 based in Malaysia that efforts to enforce common prudential standards have significantly progressed. Efforts towards the harmonisation of Shariah interpretations and issues concerning mutual recognition are also at an advanced stage. Today, Malaysia has a comprehensive and well-developed Islamic financial system, including a vibrant banking and takaful sector, and well-developed Islamic capital and money markets that operates in parallel with the conventional system. Our sukuk market is the largest in the world. The Islamic financial system in Malaysian is also well-supported by comprehensive Shariah, legal and regulatory and supervisory framework to ensure the soundness and stability of the Islamic financial system. We have also invested in human capital development to ensure a deep pool of talent and expertise to support the development of Islamic finance. For this purpose, Malaysia has established the International Centre of Education in Islamic finance (INCEIF) and The International Shariah Research Academy (ISRA) to support advanced education and research in Islamic finance.