samchain/econo-pairs-v1 huggingface dataset:
By offering settlement in central bank money, TIPS increases the speed and safety of customers’ daily transactions.5 Since 2016, the ECB has also been exploring the application of new technologies, particularly distributed ledger technologies, to market infrastructures. Together with the Bank of Japan, the ECB is conducting a research project called “Stella” which is investigating innovations that can facilitate safer, faster and cheaper financial transactions.6 But driving change also means identifying and managing the risks that come with breaking new ground. Innovations – including stablecoins – will only be beneficial if the associated risks are mitigated through effective regulation and oversight. So I believe we should follow the golden rule of supervision: “same business, same risk, same rules”. We must ensure that stablecoins do not compromise the safety and efficiency of the payment system or the soundness and stability of the financial and monetary system. And this is all the more important for stablecoins with a global reach. The G7 Working Group chaired by my fellow Executive Board member Benoît Cœuré has made clear recommendations with a view to developing a globally consistent approach to their regulation and oversight.7 As it did for the General Data Protection Regulation, the European Union can show the way here. In line with international standards and recommendations, we – and here I count on you as colegislator – should develop and enforce regulation that strikes the right balance between supporting innovation and addressing risks.

And I see it as my responsibility, as the ECB President, to report back to you, and engage in further discussion, once the Governing Council moved forward on the content and timeline of our exercise. The two way street communication principle will apply. Shaping the future of money The other topic you have asked me to discuss today is the future of money. Indeed, as central banks navigate a complex and changing landscape, we should not only aim to anticipate future trends, but also seek to shape them. In doing so, we should be particularly attentive to risks and perform a thorough analysis of their costs and benefits. The financial services environment is evolving as new entrants shake up the market. So are the public’s needs and demands. The ongoing discussion around so-called stablecoins offers a glimpse of the changes that might come. This phenomenon could disrupt the current payments landscape, with spillover effects for monetary policy transmission, financial stability and the international monetary system more 3/5  BIS central bankers' speeches  broadly. But the ECB is not standing still in the face of these challenges. Last year, the ECB launched TARGET Instant Payment Settlement (TIPS), an instant payment service that allows money to reach the recipient within seconds, 24 hours a day, 365 days a year. TIPS responds to the growing user demand for instant payments and helps ensure that any bank account holder in Europe can be reached.
Some time ago, when we had more rigid exchange rate systems, less adapted to cope with external shocks, when confronted with tighter external financial conditions, we needed to fight against the depreciation of currency to avoid destabilizing balance sheet and inflationary effects. We had to tighten monetary policy to reduce the speed of private capital outflows and sold massive amounts of foreign reserves to contain the depreciation of the currency. Most experiences ended badly. Final remarks The changes we are seeing in the world economy are part of the development that comes in the footsteps of the global financial crisis. The time has come for the recovery of developed economies, and therefore, the extraordinary monetary stimulus packages they brought about in the past must be withdrawn. By historical standards, the global financial conditions we faced in the past few years were very good, but we knew that sooner or later they would end. This is a healthy development. What is important is where this new situation will find us, as economies that managed to keep strong fundamentals and prevented macroeconomic imbalances from building up, or on the opposite lane. How costly a moving toward a “more normal” world will be for each of our countries will depend on how wisely we have administered our economies during the good times. In Chile, the policy framework that has been in place during the recent decades, has given us more tools to help the economy to accommodate the effects of changes in the external environment.

Muhammad Al-Jasser: Small and medium enterprises Opening speech by His Excellency Dr Muhammad Al-Jasser, Governor of the Saudi Arabian Monetary Agency (SAMA), at the symposium on “Small and Medium Enterprises”, organized by the Institute of Banking in cooperation with the International Financing Corporation, Riyadh, 2 November 2010. *  *  *  Excellencies and honored audience, It gives me great pleasure to welcome you all in the headquarters of the Institute of Banking. I’m delighted to receive an invitation to deliver the opening speech for the symposium on “Small and Medium Enterprises” before this distinguished elite of participants and audience. I would like to express my thanks and appreciation to the colleagues at the Institute of Banking and International Finance Corporation (IFC) for organizing this symposium. I will try in this speech to shed light on some ideas related to the importance of the role of these enterprises in the national economy, challenges facing their growth, and provision of appropriate funding for them. Dear audience, The national economy consists of an integrated wide range of public and private enterprises which utilize available material and human factors of production for providing continuous flows of goods and services to meet the needs of the domestic society and part of external demand. As a matter of fact, the sizes of local firms vary according to the size of labour, capital, sales…etc. It is mistakenly believed that large-scale enterprises are the main impetus for economic activity.
Their basis will be consistent with the CACs that are common in New York and English laws. Significantly, all those mechanisms associate the IMF and the European Commission “in consultation” with the ECB to avoid relying only on peer pressure between members states and ensure proper conditionality. As you know, the crisis has also led the Eurosytem to embark on a very limited program of bond purchases. It was our judgment that the transmission mechanism of monetary policy was severely impaired in some cases, as local bond markets were close to paralysis. That program has served us well. Monetary impact was instantly and fully sterilized. Where do we stand? Overall, those changes have been favorably received by the markets. Spreads and CDS on most sovereigns are been trending down since January. Nevertheless, the sense of crisis has not yet disappeared. Most recently, Portugal has asked for an IMF / EFSF program. The success of existing programs remains to be demonstrated. The very progressive elaboration of new framework has prevented outside analysts to see the big picture and measure the amplitude of the changes. There is also a more diffuse concern about sustainability, which I would like to discuss. Looking at aggregate numbers, it is very difficult to understand many of the concerns expressed on the euro area. The Euro area is the only major currency zone with its external accounts in balance, and which therefore does not depend on external finance.

Progress has clearly been made in the management of market and operational risks, but the advances made in the area of credit risk are, I think, particularly illustrative. Loan officers and risk managers now have at their disposal an everexpanding array of software, databases, models, and risk rating systems intended to provide empirical insight into a risk once not readily quantified. Our examiners have noted growing sophistication in banks’ internal risk rating processes, portfolio management methodologies, and the use of stress testing. As you know, all of these new tools and processes were developed and refined to promote a bank’s competitiveness and to protect it against loss - and not just to respond to a regulatory mandate. The resulting benefits to the stability of the financial sector can be seen objectively in the much lower number of problem banks, and the lower level of problem loans, in the recession that began early last year, compared to the previous one. For bank supervisors, the industry’s own growing emphasis on enhancing risk management practices has allowed us to shift our approach from evaluating financial results to understanding and assessing the quality of internal processes. By looking at the strength of internal controls and the quality of analysis and judgement that management applies, we are better able to understand how well a bank will weather potential future challenges or business downturns. In this context, one area that has come under increased scrutiny is how firms manage their compliance activities across the organization.
Lars Heikensten: How to promote and measure central bank efficiency Speech by Mr Lars Heikensten, Governor of Sveriges Riksbank, at the Sveriges Riksbank, Stockholm, 23 May 2003. *  *  *  Let me begin by welcoming you all to Stockholm and Sveriges Riksbank. We have more or less made it a practice to organise an academic conference or workshop at least every second year on a topic which we think is relevant for central bankers. Last year the theme of the conference was Monetary Policy and Financial Markets in an Enlarged European Union. This time we have chosen the topic of Central Bank Efficiency. To attain legitimacy - and keep it - central banks have to use taxpayers' money in an efficient way, not least in countries like Sweden where the central bank is now an independent institution. This is an issue of great importance to the bank, and it has occupied much of our time in recent years. We want to continue this work and develop our thinking in the area. Efficiency is also a very important issue from a European perspective and will be as important should we become a member of the Eurosystem. Central bank efficiency is a fairly abstract concept that encapsulates several areas ranging from the roles that are appropriate for central banks to perform, to cost efficiency in a narrower sense. An investigation of the relevant literature shows that there has not been much research conducted on any of these issues.

As a result, we need to work hard with these issues and invite external evaluation. Cost-consciousness is especially important in cases where a central bank determines its own budget, as hard-won legitimacy can be quickly lost. At Sveriges Riksbank, we will be continuing our search for efficiency gains, and we will so do whether or not we join the Eurosystem. To this end, we need new influences and new ideas, which I hope to get over the coming two days. Once again, I would like to extend you all a very warm welcome to Sveriges Riksbank and this workshop. BIS Review 24/2003  5
Since the authorities had decided on how much each bank could increase its credit book every single month, there was really no need to appraise credit applications in a particularly serious manner. Mortgage credits took most of the available credit volume and the remainder was allocated to safe projects. Credit losses in the banking system were only a fraction of a percentage point of the credit stock each year. As a consequence, the ability to appraise credit risk had slowly dwindled out of the banks. So, unfortunately, was the case for the supervisors. When credit controls were finally removed the volume of credit virtually exploded. All banks wanted to increase their market shares and there was plenty of pent-up demand. Many loans were given to customers who, as it appeared later, were far from creditworthy and should not have passed a proper credit appraisal. The regulations had been abolished at the wrong time and without realising what an extended period of regulation had done to the ability of banks and supervisors to handle credit risk. What can be learnt from this? Quite obviously, deregulating does not mean the abolishing of all rules according to which banks should behave. There are good and well documented reasons for regulating banks. Deregulation means the adoption of a new legal structure that is consistent with a competitive market economy. The dilemma of regulation is to balance between having too little and too much. Too much will stifle the banks, too little will lead to unsound risk taking.

Many countries, not least my own, have had bitter and expensive experiences from this. Of course, all countries have specific national features in their banking systems. The main risks are common all over the world, however, and the same challenges to supervision seem to appear everywhere. I will focus on some important issues seen from my perspective, which includes the experiences we gained during the Swedish banking crisis in the early nineties. Deregulation Why deregulate if the consequences may be so dangerous? The obvious answer is that regulations tend to create inefficiency and prevent the domestic banking system from developing in response to international competition. The long run cost to society of extensive regulations is a poorly functioning financial sector. While regulations are usually put in place to decrease systemic risk they may indeed in the long run do quite the opposite. Strong regulations mean that banks have low incentives to adopt good credit policies and risk management techniques. Supervision tends to be excessively formal, focusing on formalities rather than on actual risks. Nor are the regulations and techniques of supervision updated often enough to foster the development of new activities and management of risks. Regulations shelter the domestic banking industry from outside influence, which slowly tends to decrease efficiency and increase systemic risk. Furthermore, in a regulated environment the likelihood is large that some credits may be subsidised, perhaps even channelled to politically desirable rather than economically sound projects, leading to misallocation of resources.
BIS Review 55/2002  1  Developments in Iceland from the latter half of 1990´s until the present time resemble in many ways the experience of some of the other Nordic Countries a decade earlier but differ also in important respects. Soon after liberalisation, domestic demand picked up, fuelled by rapidly rising credit in the wake of intensified competition in the financial sector and a sharp increase in credit availability. At that time, Iceland was pursuing a fixed exchange rate policy but not as rigidly fixed as the other Nordic Countries had done a decade earlier. The expansion in the economy at the end of last decade led to a very rapid rise in the current account deficit, climaxing in year 2000. Through the effects of a tightening monetary policy, the exchange rate of the króna gradually appreciated. In the spring of the year 2000, expectations in the market shifted for a variety of reasons, one of them being concerns about the current account deficit. Subsequently the króna began to depreciate and continued to do so more or less uninterrupted but on the whole in an orderly fashion over a period of a year and a half until the end of November last year. By that time, it had fallen by about a third against other currencies. This large depreciation is not without precedent in other countries.

From that, we’ll see that a systems perspective can explain why our attempts at control sometimes fail and what we can do about it.7 A key insight from systems thinking is that controls are part of a system. Controls interact with other controls and with the production process. One implication of connectedness is that changes to any part of the system can spillover and affect other parts. Controls that work well separately may not work well together. That’s one reason why controls created in isolation and added incrementally can create unexpected results. It’s a weakness of control systems that have grown through an ad-hoc approach of “see a problem, add a control.” Let’s walk through a scenario where controls don’t behave as expected or intended. On Sunday, you run a business resumption exercise to test the ability of your primary data center to fail over to your backup data center. The test appears to be a success, and you have some useful lessons learned to make the failover process run better next time. But, when you come to work on Monday morning, something is wrong. It turns out the test corrupted customer account data. Your call center is overwhelmed with questions and complaints, because your billing system sent a blast email with overdue payment notices to all of your customers. In a simple world, controls solve problems, they don’t create them. In the real world, the control and production systems are linked, so the failed execution of a control can, in and of itself, disrupt operations.
The main issue here is that some financial market infrastructures, which are key for the EU, will soon become off-shore to the EU as a consequence of Brexit. This is particularly problematic when these infrastructures may put the EU’s financial stability at risk: some central counterparties (CCPs) for instance can be considered to be “too big to fail” entities, especially since clearing is mandatory. This is a specific concern for the euro, compared to other currencies, as European savings management is almost totally dependent on London-based financial players and market infrastructures. And yet we cannot reasonably expect that these global financial market infrastructures take into account, in their operations and risk management, the financial stability of the euro area, on top of the financial stability of their own jurisdiction. Page 2 sur 5  Therefore, since, regrettably, London will soon be outside the EU, the current setup is no longer adequate. Replicating for clearing activity in the euro area the extraterritorial approach developed by the US authorities cannot be a solution, because of the specific position of the EU capital market vis-à-vis London, and because we know by experience that in times of stress the views of the domestic authorities prevail when interests diverge. So, what should we do?

We have taken this step not because banks are weak but because they are in fact strong. Unlike in 2008, the banks are not the weak link in a crisis which this time is of public health; a crisis which is economic, but, at least in terms of its causes, non-financial in nature. This is notably the result of the regulations that we have implemented and reinforced over the last ten years. And it is what now gives us greater leeway to ease certain capital requirements, such as the counter-cyclical buffer, and to push back the entry into force of the Basel III accords by one year to 2023. All these measures should be considered in light of the – often heated – discussions on the degree of financial solidarity in Europe. Arguably, Europe could perhaps do more, but let’s not forget that it is already doing a great deal, thanks to major efforts from the Eurosystem or the easing – agreed quickly and unanimously – of the Stability and Growth Pact, which gives natural priority to national action. If we consider a possible role for the European Solidarity Mechanism (ESM), the amounts involved – around EUR 410 billion – would certainly be significant. However, the support provided by the ECB alone represents EUR 1,050 billion on the markets and up to EUR 3,000 billion in bank liquidity. Furthermore, the Monetary Union allows Italy and Spain to borrow at a far lower interest rate than before the euro.
Road Map: Monetary and Financial Sector Policies for 2017 and Beyond  Delivered by Dr. Indrajit Coomaraswamy Governor Central Bank of Sri Lanka 3 January 2017  1. Introduction Your Excellencies, Members of the  So, let me warmly welcome you to the  Monetary Board, Deputy Governors and  presentation of this year’s Road Map. Officials of the Central Bank, Distinguished Invitees, Ladies and Gentlemen,  Ladies and Gentlemen, as you aware, the core objectives of the Central Bank are the attainment of economic and price  The presentation of the Road Map is a  stability and the maintenance of  very important tradition that was  financial system stability with a view to  initiated by the Central Bank in 2007 and  encouraging and promoting the  this is the 10th statement in that tradition  development of productive resources of  that we are presenting today. It is our  Sri Lanka. We attach the highest priority  belief that sharing our policy direction  to delivering collectively on the  would make our policies for the medium-  mandates given to us. The considerable  term more predictable and transparent,  resources of the Central Bank of Sri  and would help you in shaping your own  Lanka are focused on achieving these  plans and operational modalities in the  objectives on a sustained basis and on  future. It will also ensure greater clarity  performing the important agency and  regarding our policies and actions.

The challenge that we are having right  The country has a number of structural  now is to put in place policies that give  problems that have been amplified over  us sustained stabilisation of  the years by the large fiscal and trade  macroeconomic fundamentals in the  deficits, which are the core weaknesses  country, amidst uncertain global  of the Sri Lankan economy. Being a twin  conditions. deficit country increases vulnerability in  It is important to recognise that stabilising the economy after decades of  an uncertain and volatile global economic environment. fundamentally unstable macroeconomic  Unsustainable budget deficits boost  policies cannot be achieved without  excess and untenable demand in the  discipline. This will inevitably result in  economy. When there is excess demand,  some pain in the short-term. However,  it leads to inflationary pressures and  there is every possibility that a more  higher nominal interest rates in the  promising future can be realised  economy and there is also a higher  through the policies and programmes  propensity to import, given the  that are already in the pipeline. For this  limitations in domestic supply. That in  to happen, consensus must be built  turn, exerts pressure on the balance of  among politicians, policy makers and  payments and the exchange rate.