samchain/econo-pairs-v1 huggingface dataset:
Economic and monetary developments Since our last meeting, the Governing Council has left key ECB rates unchanged: the main refinancing rate currently stands at 0.75%; the rate on the deposit facility stands at 0%; and the rate on the marginal lending facility stands at 1.50%. Economic activity contracted for a third consecutive quarter in the fourth quarter of 2012. Available indicators signal further weakness at the beginning of 2013, with domestic demand remaining dampened. This is due to weak consumer and investor sentiment and to the necessary balance sheet adjustments in both the public and private sectors. Foreign demand also remains subdued. Economic weakness in the early part of 2013 is expected to be followed by a very gradual recovery later in the year. Strengthening global demand, our accommodative monetary policy stance and the improvement in financial market confidence across euro area countries should all work their way through to spending and investment decisions and support the recovery. Even though we have yet to see sustained improvement in the real economy, survey indicators have confirmed earlier evidence of a stabilisation of business and consumer confidence, albeit at low levels. Taking a somewhat longer view, the improvement in financial market confidence since last summer has been significant. As regards the exchange rate, let me be clear that the exchange rate is not a policy target, but it is important for growth and price stability.

As you heard from the Bank’s Governor, Mark Carney, yesterday, the Bank’s strategy is to enable innovation and empower competition, while ensuring monetary and financial stability.2 In practice the Bank is embracing fintech, and working to do as much as we can to ensure that it develops in ways that maximise the opportunities and minimise the risks for society, and that as such are entirely consistent with the defining theme of this year’s summit – “the value and purpose that fintech has to society”. The Fintech Hub one year on The vehicle we use to do all this is our Fintech Hub, which we launched one year ago.3 This team, which grew out of our award-winning Fintech Accelerator, sits at the heart of the Bank and leads our fintech strategy by bringing together expertise from all of Bank’s business areas. They have engaged extensively with the fintech sector to understand developments and apply these to support the next wave of innovation in finance. Examples of their work this year include: collaborating with HMT and the FCA to set out the UK’s approach to cryptoassets and distributed ledger technology in financial services4; examining challenges in cross-border payments with colleagues from the Bank of Canada and Monetary Authority of Singapore 5; exploring how  As set out by Mark Carney in his 2018 Mansion House Speech, “New Economy, New Finance, New Bank”, available at https://www.bankofengland.co.uk/speech/2018/mark-carney-speech-at-the-lord-mayors-bankers-and-merchants-dinner-mansion-house. 2 “A Platform for Innovation”, available at https://www.bankofengland.co.uk/speech/2019/mark-carney-speech-at-innovate-financeglobal-summit-2019.
What makes our task harder is that the goalposts are moving all the time. Ever increasing complexity  4  BIS Review 52/2006  and interlinkages in the international economic and financial system mean that legislators and standard-setters must run just to try to catch the moving train. In the European context, cross-border integration has progressed further than in other parts of the world, which strengthens financial development and presumably also stability. But integration means increased risks for contagion and we must be vigilant to identify and deal with any vulnerability in the system. Regional FSAP-type assessments are at the same time broad and focused and thus useful for this purpose. In my view, it would be totally wrong to regard the FSAP as a process where the IFIs are the providers, the countries the recipients and the other stakeholders form an interested but passive audience. We need an ongoing dialogue to understand and improve the process. Hence, I am particularly grateful to our Belgian hosts for having arranged this seminar which will give us an opportunity to discuss these important issues. Thus my final conclusion, which answers the question posed in the title of this speech, can be very short: Yes, I strongly believe that regional financial stability assessments in the EU and EEA areas can provide additional values to financial stability and to a better understanding of how the cross-border interlinkages between the financial groups and the infrastructural financial arrangements under certain circumstances may add to the vulnerability of the systems.

What to expect from the Fed’s Monetary Policy Normalization?1 Sebastián Claro Vice‐Governor, Central Bank of Chile              I would like to start thanking the organizers for this invitation. Let me start with a disclaimer. Next Monday, April 3rd, the board of the Central Bank of Chile will present its inflation report to the Senate. Therefore, I will not be able in this occasion to offer a detailed discussion on the macroeconomic situation and perspectives in Chile, which will be described in detailed in the report. Rather, I have decided to focus on a broader issue that is relevant for Chile and the region in the current scenario. During 2017, we will finally witness the process of monetary policy normalization in the United States. After almost 8 years keeping the Federal Funds rates essentially at zero, the Federal Reserve has started a gradual process of interest rate hikes. This is good news. Fundamentally, the normalization of monetary policy is the natural consequence of a normalization of the US economy after the Global Financial Crises. A normal US economy is a positive phenomenon for the world economy. However, this transition period may become bumpy. Indeed, previous episodes of rate hikes by the Federal Reserve have not been smooth at all for emerging economies. The most obvious of these examples is the debt crisis in the early 1980s.
That might not matter were the consequences limited to the party-goers. But they are not. When the party ends, some innocent bystanders may lose their homes altogether. Moreover, the party-goers aren’t just deposit-taking banks. A wide range of financial institutions, including investment banks, monoline insurers, even hedge funds, have the potential to cause significant damage to the rest of the economy in the wake of their demise. Are they all to be helped to get home safely when the party ends? If so, will they all be regulated in the same way as banks? If not, how can we limit the potential cost to the taxpayer? Add to this the problem that many of these institutions are global in scope, but the responsibility for both regulation and rescue remains firmly at national level, and you can see why policy-makers get headaches as bad as the party-goers’. No individual bank, or indeed the authorities, can easily find a way out of this because their incentives are to continue in the same manner. There is, therefore, no point blaming anyone for the outcomes. But together we have to find an answer. Of course, excessively strict and detailed regulation would mean that there were no parties worth going to and the economy as a whole would suffer from a suppressed and inefficient financial sector.

They may also, under a compromise text, render partly redundant and ineffective the responsibilities of supervisors of home and host countries, as well as those of micro-prudential and macro-prudential supervisors. In this context, I believe that the creation of a banking union is to be supported. It would be a major development for banking supervision in Europe, which would bring numerous benefits and would enable us to efficiently address the current difficulties. Such a development would most likely have very positive consequences in that it would be a step towards greater European harmonisation. Naturally, the benefits of such a reform would be more far-reaching but such questions go beyond the scope of today’s conference. Questions regarding the impact and stakes of Basel III will already give ample food for thought in the rich debates and discussions this morning. I wish you all a fruitful conference. BIS central bankers’ speeches  3
Chairperson, some of the challenges faced by women entrepreneurs regarding access to finance have been specifically identified as follows: •  Lack of collateral/ discriminatory property rights;  •  Financial illiteracy;  •  Lack of awareness of development finance;  •  Lack of financial confidence;  •  Lack of appropriate products;  •  Uncertain business climate;  •  Inadequate financial skills;  •  Lack of banking facilities;  •  Cumbersome application procedures and complicated forms to complete;  1  2  A Report on the Study Tour to Tanzania and Rwanda, 20–26 June, 2011, Gender in Development Division. BIS central bankers’ speeches  •  High cost of finance. •  Poor gender disaggregated data which limits market information on what women want and need  •  Most businesses are informal and in lower value areas  Bank of Zambia response The Bank of Zambia has responded by putting in place measures to maintain a stable macroeconomic environment which have resulted in significant reduction in inflation; downward movement in interest rates; and a fairly stable exchange rate. The Bank of Zambia is also the lead implementer of the Financial Sector Development Plan on behalf of the Government of the Republic of Zambia. As you may be aware, the Zambian government formulated the FSDP as a comprehensive strategy for addressing challenges in the Zambia financial sector.

In other literature, women have been credited with owning 48 per cent of MSMEs in Africa (NFNV). Therefore, women are increasingly being recognised as a powerful source of growth. Indeed, at the Second African Women’s Economic Summit held in Lagos in July 2012, women were recognised as the New Emerging Market. Chairperson, as you may be aware, the Zambian economy has been growing at an average rate of above 5% in the recent past. Most of this growth has been broad based with economic sectors, such as, agriculture, mining, manufacturing and tourism recording impressive growth rates. However, there is potential for further economic growth across all sub sectors if the potential of women entrepreneurs can be harnessed. Limited access to affordable financial services such as savings, loans, remittances and insurance services by the vast majority of the population, especially for women and the SME sector is acting as a constraint to the growth impetus. It is recognised that many women, together with the businesses they run are financially excluded. This is also acknowledged in a 2011 Report by the Gender and Development Division on the study tour to Tanzania and Rwanda, regarding women’s economic empowerment. The Report states that “there is evidence that gender disparities in national development still exist in Zambia and one of the areas of concern is access to finance by women entrepreneurs.
There is, of course, a reason why I am standing here talking about historical events. But, before I get to this reason, I would like to say a few words about the money we use today. Central bank money and commercial bank money Today, we have three kinds of money. The first kind is the one I have talked about the most today, banknotes and coins. These are a form of central bank money, that is, money issued by the central bank. As I mentioned earlier, the special thing about central bank money is that it has no nominal credit risk, as it stands for a claim on the central bank, which cannot go bankrupt. Cash is also the form of central bank money that can be held by the general public. The second sort of money is also central bank  3 [10]  money, but in electronic form. This is the money that is held in accounts with the Riksbank and it can only be held by those who are allowed to have accounts in the Riksbank, which currently means credit institutions, securities companies, clearing organisations and the Swedish National Debt Office. It is electronic central bank money that the banks use when they are making large payments to one another. This is done through a payment system called RIX. Most of the electronic payments made in Sweden, whether they are made by direct debit, credit transfer or card, pass through RIX at some point. The third kind of money is commercial bank money.

In two reports 6, representatives of the private sector, the European Commission and the European Central Bank presented concrete recommendations on how, for example, regulatory barriers could be broken down. Almost 12 years have now passed since the second report was published and some of these proposals and recommendations have still not been implemented. For example, we still do not have an EU-wide framework for the treatment of interests in securities. Drawing once more on the comparison with the United States, a cross-border securities transaction costs at least ten times as much in Europe as it does in the United States. I think that makes it clear that Europe’s economy has a lot to gain from dismantling the relevant regulatory barriers as part of a capital markets union. 5  At that time with the caveat: “to the extent necessary for the proper functioning of the Common Market”. 6  http://ec.europa.eu/internal_market/financial-markets/docs/clearing/first_giovannini_report_en.pdf. http://ec.europa.eu/internal_market/financial-markets/docs/clearing/second_giovannini_report_en.pdf. 4  BIS central bankers’ speeches  In addition to harmonised regulation for securities, we should also seek to implement a harmonised legal framework for crisis management. The Council Regulation on cross-border insolvency proceedings has provided a common regulatory framework governing, for example, jurisdictions and the recognition of court judgements. But within this framework, there are substantial national differences, such as regarding the extent to which various stakeholders are protected in the event of an insolvency. In my view, a single resolution framework for non-banks, i.e.
One conclusion seems clear: prudent risk management by a critical mass of firms will not only help to ensure a safe and sound financial system, but also will reward individual institutions with longterm profitability. In my view, market discipline, enhanced by appropriate regulation and supervision, offers the only realistic path for us to achieve our goals of a strong and stable marketplace. Today, I would like to focus my comments on the importance of risk management techniques and how market discipline can be enhanced to the benefit of public and private sector participants alike. A series of market events over the past year and a half, beginning with the devaluation of the Thai baht in July 1997, had a major impact on many lenders and investors, revealing in the process several shortcomings in risk management techniques. One lesson financial institutions learned from these events was the need to continuously reassess both counterparty credit risk management techniques and assumptions about market liquidity. Broadly, financial institutions learned that reliable estimates of the size and portfolio composition of major counterparties were lacking and that improved credit risk management techniques were needed in two key areas: credit and market exposure measurement, and counterparty due diligence. Let me be a bit more specific about some of the weaknesses found in credit risk management techniques. For example, some institutions routinely performed credit assessments using sparse, often unaudited financial information from valued customers, some of which had recorded substantial profits in previous years.

CDS spreads among  2  BIS Review 25/2008  Icelandic banks are much wider than among foreign banks with comparable credit ratings, and much wider than many – including respected financial analysis institutions abroad – consider appropriate and consistent with the banks’ financial strength and performance. 1 It is worth remembering that Iceland’s financial system has grown by leaps and bounds recently, and the operations of Icelandic commercial banks extend to a large number of foreign locations. Iceland’s three largest commercial banks now generate more than half of their income through their operations in other countries. Those operations are distributed over a wide geographical area. While they are most prominent in the Nordic region and the UK, they are also visible in Continental Europe and farther afield, though to a lesser extent. Through these operations, Iceland’s banks have fortified their foundations and distributed their risk. They are international banks with headquarters in Iceland, and they are much less dependent on economic developments in Iceland than they were previously. At the end of January, the banks published their annual accounts for the year 2007. These reflected both the success of the past several years and last year’s changes in the global capital markets. For the year as a whole, the banks demonstrated excellent performance. Profits were good, and core operations yielded strong returns. As can be expected, profits dropped in the fourth quarter, as was the case with banks all over the globe.
In our case monetary policy set by the MPC should be able to respond to the macro implications of any dislocation to credit markets to the extent that they influence the outlook for inflation and thus deviations of inflation from target, just as the MPC conditions its policy decisions on asset price and balance sheet developments on all other occasions. That's natural. But, what we have not done – and should not do – is in any sense aim off our preferred setting of monetary policy because of financial instability. That has not happened. That outcome depends on having institutional structures governing decisions on monetary policy and financial stability. Internationally the picture remains more mixed on the latter. Let me next move on to the first stage of what I will call developments in money. Many central banks, the Bank of England included, are now implementing Quantitative Tightening (QT), the reversal of the Quantitative Easing (QE) we had previously used. QE has worked through its effects on interest rates and asset prices more generally. Those effects are temporary and their size is state contingent, being larger in times of crisis and market upheaval. We can think of QT likewise, except that we are deliberately implementing it gradually, and not in stressed times. It is not an active tool of monetary policy, but any effects it does have will be captured in the normal way of monetary policy setting, through realised financial conditions.

You will be mightily relieved to hear that we are into the home straight now, but it contains the small issue of non-bank finance. Given the increase in bank regulation required in the aftermath of the financial crisis, it is not surprising that the last decade has seen a relative and absolute increase in non-bank finance. Continuing the theme developed earlier, one important way to look at the bank versus non-bank world is that in the former there is assurance on the value of money as the main liability of banks, while in the latter the value of investments explicitly and deliberately is not assured. This is important, but we also have to recognise that the growth of non-bank finance has led to the significant expansion of the landscape of systemic risk since the crisis. In other words, we have seen that the non-bank world can transmit risk into the bank world, and other parts of the core of the financial system, like central counterparties. Consequently, the relative focus of our financial stability work has shifted to the risks posed by non-bank financial institutions (NBFIs).
Capital flows, net in % of GDP Financial account flows, in % of GDP  15 20.0  10  MK  5  Baltics  5.0 0.0  RS  LV  2017  2016  2015  2014  2013  2012  2011  2010  -20  2009  -10.0  2008  BG  2007  -5.0  2006  SI  25  2005  -15  20  2004  -10  15 SEE LT BalticsHR RO AL  2003  CZ CEE  10 CESEE  2002  HU -5  EE  2001  -5  SEE  10.0  EU28 0 PL 5  2000  0  CEE  15.0  Source: Eurostat, IMF and NBRM calculations. With the occurrence of the crisis, investment ratios plunged across the board, and despite the more recent recovery, the level of investment in most of the countries is still below the pre – crisis maximum. The crisis was accompanied by rising uncertainty, increased risk premium, and most importantly, sharp reversal in the external financing. The region has been shielded partially from 2  the sudden stop, given the FDI dominance as a stable financing, and the contained bank deleveraging, amid regional initiatives (Vienna Initiative in particular). Yet, some of the countries were also caught by the crisis in the middle of rising vulnerabilities, excessive leverage in particular, which precluded faster recovery of the investment rates.

The estimates reveal shortfall, meaning that after the crisis, the investment in the 1  The only exception is Macedonia, given the strong investment cycle after the crisis, driven by public investments and structural reforms in the export segment. 2 Transition report 2015-2016 “Rebalancing Finance”, European Bank for reconstruction and development. 4  region is lower than in the peer countries, in the range of around 3 to 6 percentage points of GDP. Similar inference is drawn by the IMF (2016)3, pinpointing post-crisis gaps in the capital stock in the CESEE region compared to estimated benchmarks, being reflection of lower savings rates in the region, narrower borrowing space after the crisis and lower return on investment. This notion is confirmed with the data on the real capital stock in the region, as well, which is around 40% of the EU-28 average, with the SEE region lagging behind significantly. Though this ratio is rising, yet it clearly indicates large scope for improvement. Chart 5: Real capital stock, per capita in CESEE region vis-à-vis EU28 0.70 0.60  0.50 0.40 0.30  2014  2012  2013  2010  SEE  2011  2008  CEE  2009  2006  2007  2005  2003  CESEE  2004  2001  2002  2000  0.20  Baltics  Source: Penn World Table, version 9.0 and NBRM calculations  2. Investment financing Many policy measures for unleashing investment growth are suggested in this context.
Dimitar Radev: Assessment of the banking system in Bulgaria Statement by Mr Dimitar Radev, Governor of the Bulgarian National Bank, on the occasion of the completion of the asset quality review and stress test of the banks in Bulgaria, 11 August 2016. *  *  *  Today the Governing Council of the Bulgarian National Bank adopted the results of the asset quality review and stress test of the banks, as summarized by the international professional services company Deloitte. The main objective of the review was to present a thorough and independent assessment of the banks and the banking system as a whole. In its scale the exercise was unprecedented in the Bulgarian banking history and engaged more than 900 experts, including experts from the most reputable international audit firms, which acted under the direction of the BNB. The detailed results for each individual bank and the system as a whole will be announced at 1 PM on Saturday as per the formerly communicated announcement date. Following the announcement, the Bulgarian National Bank will be ready to address any specific questions related to the results. The asset quality review and stress test were mandated to the Bulgarian National Bank by law and they stem from the Government’s National Reform Programme. On that ground, I have presented the report on the outcomes to the Finance Minister and on Monday I will submit it to the National Assembly.

I would like to assure the public, that we will be consistent in our disciplined approach and we will continue to follow our plan for reforms in the banking sector focusing not on the issues of the past but on addressing effectively the challenges of the future in order to maintain financial stability and integrate successfully in the European financial infrastructure. 2  BIS central bankers’ speeches