samchain/econo-pairs-v1 huggingface dataset:
Eventually, they raised the credit rating of the Kingdom to advanced grades. This environment promoted the interest of foreign investors to participate in and benefit from the various investment opportunities available in the Saudi economy. The Saudi banking system has played a vital role in the enhancement of the national economy. Thanks to its use of the latest technologies and various banking products, the banking system has witnessed good development under a supervisory system which is very keen to meet domestic requirements and legislation and to comply with international standards, including Basel Capital Adequacy Standard. The banks operating in the Kingdom are very serious in the application of this standard. As a result, the Kingdom's banking system has become one of the advanced systems, not only at the regional level but also at the international one. Dear Audience, Basel II Standards are the most important supervisory initiatives of this decade, and they will have a considerable impact on changing the conduct of risk management at all banks regardless of their size and location. The Standards aim at achieving a number of objectives, including ensuring the capital adequacy of the banking sector to encounter any latent risks and the assessment of banks' risk management systems so that the supervisory authorities could ensure that they are appropriate, in line with the risks that banks might encounter, and up to the best banking practices in the area of effective banking supervision.

Hamad Al-Sayari: Challenges posed to investment in Saudi banks Speech by His Excellency Hamad Al-Sayari, Governor of the Saudi Arabian Monetary Agency, to the Symposium on Challenges Posed to Investment and Saudi Banks, Riyadh, 2 December 2006. *  *  *  Dear Audience, At the beginning, I would like to welcome all honorable attendance. It gives me a great pleasure today to address you at the outset of the deliberations of this symposium on "Challenges Posed to Investment and Saudi Banks in an Environment of Global Economic Openness" which is convened at a time the Kingdom is witnessing a period of economic growth accompanied with and enhanced by steps of economic reforms in the fields of streamlining of regulations, restructuring of the national economy, and approval of a number of mega development projects as well as the accession to the World Trade Organization which is an important step towards enhancing integration into the world economy, coping with economic developments, and attraction of foreign investments apart from accession to global markets which will be reflected on the competitive capacity of the national economy. Dear Audience, The current Symposium is being held in a promising economic environment in this country. The Kingdom has recorded outstanding economic results. The real gross domestic product rose by 6.5 percent in 2005. This growth rate was reflected on almost all sectors of the economy which is characterized by strong investment. International rating agencies recorded their appreciation and certified the efficiency and strength of the national economy.
First, the question is being raised as to whether price stability should not be interpreted more broadly and should include asset prices in addition to consumer prices, in order to prevent future financial crises. In my view, this would be the wrong conclusion. Although it is correct that central banks cannot and may not neglect the movements of asset prices, and, in particular, those of real estate prices, they should not attempt to stabilise asset prices with the aid of the interest rate tool, if this would lead to a conflict of goals with respect to price stability. Macroprudential tools are therefore needed in such a case, in order to counter imbalances on the real estate markets. I will return to this point in my comments on the role of central banks in financial stability. 2  BIS central bankers’ speeches  Second, the question is raised as to whether the inflation targets set by most central banks might not be too low. The argument is that, in normal times, higher inflation targets would lead to higher nominal interest rates. This would open up the freedom of action for conventional monetary policy because the zero bound for interest rate policy would not be reached so quickly. This reasoning does not seem conclusive to me either. For instance, given the history of the struggle against inflation, it is rather bold to assume that wellanchored inflation expectations can simply be released and then immediately locked in at a desired higher level.

The Eurosystem cyber strategy for financial market infrastructures Following the increase in both the frequency and severity of cyberattacks over the last few years, legislators, regulators and standard setters have issued legislation and guidance on cyber security at national and international level and at cross-sectoral as well as sector-specific level. Let me briefly mention three initiatives. First, in 2016, the EC adopted the Directive on security of network and information systems (the NIS Directive). Its aim is to bring the cybersecurity capabilities of operators of essential services to the same level of development in all the EU Member States and to ensure an efficient exchange of information and good cooperation on the topic throughout the EU. Second, at international level, the G7 countries have drawn up a set of fundamental elements of cybersecurity for the financial sector, as well as three further recommendations on the effectiveness of cybersecurity assessments, third-party risks, and coordination with other critical sectors. Third, with a key focus on financial stability, the CPMI-IOSCO published a principles-based “Guidance on cyber resilience for financial market infrastructures” in June 2016. Supplementing the “Principles for Financial Market Infrastructures”, it provides additional detail related to the preparations and measures that financial market infrastructures should undertake to enhance their cyber resilience. In recognition of the escalating cyber threats, the legislative and regulatory guidance and the required paradigm shift, the Eurosystem’s overseers have launched a strategy for cyber resilience in relation to financial market infrastructures.
Since Norges Bank will be providing the Ministry of Finance with concrete advice regarding a countercyclical capital buffer, I would like to devote some time to stating the reasons why such a buffer is necessary, and why, more generally, regulation of the banking sector is necessary. Then I shall touch upon the interaction with monetary policy and will also add some brief comments about some of the challenges facing monetary policy in the wake of the financial crisis. Why capital regulation? A well functioning financial market is essential for virtually all other economic activity in a market economy. Banks are a key component of the financial system. Banks channel money from savers to investors. Banks determine who should be given credit and closely monitor borrowers and their projects. This is a task that would be difficult for small savers to undertake. Resilient banks and prudent banking are important for a solid and stable economy. If banks end up with insufficient equity capital following substantial losses in bad times, they will have to tighten lending. This may serve to amplify the downturn, as is currently the case in a number of European countries. Compared with other enterprises, banks have limited equity capital. It is often more costly for banks to fund lending with equity capital than with deposits and borrowing from the market. As deposits are readily available to depositors and many deposits are covered by a deposit guarantee, depositors accept a relatively low interest rate.

Banks can reduce lending volumes. Banks can also change the composition of their lending portfolio by shifting into lower risk-weighted assets, by, for example, tightening lending to enterprises and increasing lending to households. Norwegian banks are well on the way to adjusting to new and higher capital requirements, including a countercyclical capital buffer. Developments in banks’ earnings indicate that banks can increase their CET1 ratios by around 1 percentage point a year without reducing lending growth. 5  3  Basel Committee on Banking Supervision, An assessment of the long-term economic impact of stronger capital and liquidity requirements, August 2010. For an updated collection of references to studies of the costs and benefits of macroprudential regulation, see Annex 1 in IMF Working Paper WP/13/167, by Arregui et al. “Evaluating the Net Benefits of Macroprudential Policy: A cookbook”, July 2013. 4  See Norges Bank Memo No. 1 2013 for further discussion and references. 5  In the calculation there is an assumption of an annual increase in banks’ risk-weighted assets of around 4%, earnings in line with 2012 and all profits are used to increase equity capital. It is also assumed that the transitional arrangement is retained and is binding. 4  BIS central bankers’ speeches  Capital requirements and monetary policy The countercyclical capital buffer and the key policy rate are two instruments serving different objectives. The objective of the countercyclical capital buffer is to increase banks’ resilience to losses in a downturn. The primary objective of monetary policy is low and stable inflation.
4  Special Drawing Rights. 6  BIS Review 42/2009  exploitation of petroleum resources. Global capital markets give us an opportunity to distribute the spending of these revenues across current and future generations. There are no other options for investing this wealth that could have shielded the Fund from the global economic downturn. Other government assets, such as shareholdings in domestic industries and subsea resources in the North Sea have also fallen sharply in value, at market prices. Real household housing wealth has also declined since summer of 2007 to the end of 2008. The return on the Government Pension Fund – Global generated in 2008 was 3.4 per cent lower than that on the benchmark portfolio. This is considerably lower than expected in the light of our investment strategy, which features a large number of small and independent positions. This performance was due primarily to the investments in the fixed income portfolio, which proved to be less well-diversified than expected, and to investments that exposed us to changes in liquidity premiums. The Fund currently has extensive holdings of bonds, that despite high ratings, are difficult to trade in today’s market. Realised losses have been limited. The flipside of large book losses is that this portfolio has a high yield, reflecting not only the increase in credit risk but also high liquidity premiums and fears and uncertainty in the market. History has seen a number of deep financial crises, and market conditions will return to normal in time.

The Pension Fund was formally established in 1990, but it was not until 1996 that the first allocation – NOK 2 billion – was made. The Fund is fully integrated with the government budget, and the same priorities are imposed on spending from the Fund as on any other government spending. This means that all Norway’s petroleum revenues, as well as the return, go into the Fund. Then, as part of the budget resolution, the Storting decides on an annual transfer from the Fund to cover the government budget deficit. This procedure effectively prohibits use of the capital in the Fund for purposes not considered sufficiently important to be prioritised in the regular budget process. High oil prices led to record-high inflows of capital into the Fund of NOK 384 billion in 2008. The Fund’s market value was NOK 2 276 billion at the end of the year. The Ministry of Finance has decided to increase the allocation to equities in the Fund from 40 to 60 per cent. The financial crisis has dealt a blow to our investments in global equity and fixed income markets. The annual real return since Norges Bank commenced the operational management of the Fund is now just 1 per cent, which is well below the assumed long-term return of 4 per cent. The Fund has not reaped a risk premium in the equity market as we had expected. During the same period, considerable revenues have been generated from the  3  New Arrangements to Borrow.
The banks play a central role in financial stability as the majority of payments go through the bank system. The Swedish banks fund half of their borrowing through deposits from the general public and half of it through loans from one another and on the financial markets. If problems arise that prevent the banks from obtaining funding by borrowing from one another or on the financial markets, they can borrow from the Riksbank. The Riksbank is what is usually known as the lender of last resort. Figure 6 TED spread Difference between 3-month interbank rates and government security rates Basis points 500 450 400  500 Sweden Euro area USA  450 400  350  350  300  300  250  250  200  200  150  150  100  100  50  50  0  0  Jan-07 Apr-07 Jul-07 Oct-07 Jan-08 Apr-08 Jul-08 Oct-08 Jan-09 Apr-09 Jul-09 Oct-09  Sources: Reuters EcoWin och Riksbanken. 6  BIS Review 160/2009  During the financial crisis several financial markets ceased functioning. The banks’ confidence in one another declined and they became unwilling to lend to one another. Developments during the crisis can be illustrated by, for instance, the so-called TED spread, the difference between the interest on three-month interbank loans and three-month treasury bills. As confidence between the banks declined, the TED spread increased during the crisis and peaked when Lehman Brothers fell (Figure 6).

Second, transparency must be improved in the financial system and for CRT in particular. Indeed, for stress tests to be fully relevant, we need reliable data at the aggregate level. Without good reporting of exposures, mitigation actions are not efficient. Increased transparency can take various forms. One means is to increase the transparency of institutions such as hedge funds or private equity funds. Another possibility is to increase the transparency of market operations, with trades recorded in a central depository, for example. Such infrastructure improvements can also produce transparency in a “seamless” way, avoiding an excessive reporting burden. 2  BIS Review 33/2007  Third, there is a need to work to better understand and assess risk at a system-wide level, including the linkages that bind together the various elements of the financial system. Like in physics, there are resonance frequencies, propagating tensions from one knot of the network to another. Stress testing plays a key role here. To complement individual stress tests, policymakers are developing global and cross-country stress tests. These impact studies consist in measuring the impact of linkages between business cycle fluctuations and a range of key observable variables that best characterise the banking sector. These exercises should also incorporate potential market contagion through different channels: banks' interlinkages (domino effects) and bank portfolios’ exposures to shocks. **** To sum up, we should not forget that the current financial system is multidimensional and closely interlinked. It remains essentially an untested world in stress situations.
While there have been periods of financial distress in individual banking systems in the region in past years, such incidents have generally been fewer and less severe than in other emerging markets. Asian banks were able to meet the Basle Committee’s recommended 8% minimum capital adequacy ratio with comparative ease. Moreover, despite the fact that barriers to entry in some economies have protected the Asian banks from the full forces of competition, they have managed to survive on lower interest margins and achieve a higher level of operating efficiency than their counterparts in other regions. 11. The Asian banks have of course benefited from operating in the fastest growing region in the world, and one where the macroeconomic environment in terms of GDP growth, inflation and exchange rates has been much less volatile than in, say, Latin America3. More recently, however, growth in some economies in the region has slowed. I hope that this will turn out to be a cyclical, rather than a structural, phenomenon. At any rate, the economic environment is currently somewhat less benign, and this has brought into sharper focus some of the challenges which banks in the region are now facing. 1 2 3  The Emerging Asian Bond Market, World Bank 1995. The East Asian Miracle, World Bank 1993. BIS Annual Report 1996. BIS Review 55/1997  -3-  The challenges faced by Asian banks 12. Let me attempt to describe what these challenges are.

But turning back to banking in the region, even if this scenario is realized, and there must of course be much uncertainty on this, the amount that banks would be called upon to finance would remain very substantial in absolute terms. For the foreseeable future, therefore, the banks will still be playing a key role in mobilizing savings in the region and channeling this into investment. And this makes it even more important that banking systems in the region remain healthy. Of course, foreign banks will play an important financing role, in particular those based in Hong Kong which is the major centre in the region for the arranging of syndicated loans. But within most of the banking systems of the region it is the local banks which predominate in terms of share of assets. The position of Asian banks 10. So let us take a look at the current position of the Asian banks. It is in fact very difficult to generalize because the banking systems in the region are not homogeneous. But certainly if we look at what the World Bank has called the eight “high performing Asian countries”, the Asian banks have been at the heart of the Asian success story2. This is partly due to the emphasis laid by governments on trying to ensure the stability of banks, through prudential supervision and other means, to encourage confidence among savers.
Nina Stoyanova: The future of money Speech by Ms Nina Stoyanova, Deputy Governor and Head of the Banking Department of the Bulgarian National Bank, at the Manager Magazine Fourth Banking and Finance Forum “The Future of Money”, Sofia, 20 October 2021. * * * Thank you for inviting me to open today’s fourth Banking and Finance Forum on the topic ofThe Future of Money. New technologies are changing the financial sector today and leading to the offering of increasingly diverse and convenient payment products in a highly competitive environment. The policies of the European Commission, the European Central Bank and national regulators are aimed at catalysing this process, to exploit more fully the potential offered by technology and to achieve cheaper, safer and more accessible payment solutions. The dynamics of the processes in Europe is also fully valid for our country. Data on payments processed by payment systems in our country show a significant growth. For the first six months of 2021, the value of payments made through the BNB-operated Real-time Gross Settlement System in BGN (RINGS) increased by 30% compared to the first half of 2020, while for the same period the value of payments in euro through the national component system of the large-value payment system in euro – TARGET2-BNB increased by 65.7%. I would like to touch briefly on some of the recent technological developments in the field of payment services in the European Union and in our country.

Insofar as the legal provisions of Delegated Regulation (EU) 2018/3893 are more general, its practical application raises many issues that require additional clarification. To this end, in 2019 4. the European Banking Authority (EBA) established a Working Group on APIs under PSD2 Within this group, representatives of the EBA, the national competent authorities, the European Commission, and the European Central Bank consult the market participants (banks, third party providers and industry organisations) and identify potential practical implementation problems and possible solutions thereof. Based on the consultations, by 31 July 2021 the EBA has published clarifications on 31 issues relating to the practical application of the requirements for APIs. With the aim of converging the supervisory practices among the Member States of the European Union, in June 2020 the EBA published its Opinion on obstacles under Article 32(3) of the regulatory technical standards on strong customer authentication and common and secure open standards of communication (EBA/OP/2020/10)5. The work on the raised issues is still going on via the Q&As published by the EBA6. The Bulgarian National Bank, in its capacity as a regulator, has active communications with the market participants with the aim of improving the functionality of the dedicated interfaces already 2/3  BIS central bankers' speeches  built by the banks in the country. The process is developing in line with the European progress and in compliance with the legal framework, the opinions and clarifications published by the EBA.
As they differ greatly in terms of economic structure, exchange rate and monetary regimes, and in the degree of nominal and real convergence already achieved, no single path towards the euro can be identified or recommended to all of them. Various strategies may be feasible, provided they are based on sound economic reasoning, conform to the existing institutional framework and contribute to the high level of sustainable convergence, which is essential when joining the euro area. Progress towards the adoption of the euro will thus need to be assessed on a case-by-case basis. At the same time, the principle of equal treatment will continue to apply throughout the entire process of monetary integration. Adopting the euro is an irrevocable decision and it is of the utmost importance that countries fulfil the convergence criteria not only nominally but also in a sustainable manner before they enter the euro area, as required by the Maastricht Treaty. There will be no additional criteria, neither will there be a relaxation of the criteria. The need for structural reforms Let me now discuss the need for structural reforms in Europe which applies to both “new” and present Member States. On March 2000 the European Council held a special meeting in Lisbon dedicated to employment, economic reform and social cohesion.

You should have first set up a political federation, with a federal government and a federal budget. Then you could have introduced a single currency.” Two main arguments were put forward. First, without a federal budget of some significance the policy mix would have been very erratic, depending on the random behaviour of the different national fiscal policies of the member countries of the Monetary Union. And second, without such a federal budget it would be impossible to weather, with the help of the fiscal channel, asymmetric shocks hitting one particular member economy of the Monetary Union. These two economic arguments are perfectly valid and would have been sufficient to discourage the creation of the Euro had we not set up a profoundly original concept of national fiscal policy surveillance. It is this concept, the Stability and Growth Pact which guarantees the coherence and the consistency of the European Economic and Monetary Union (EMU), namely a single currency area without a political federation. On top of these fundamental economic underpinnings a number of other considerations are worth mentioning. In particular, a fiscal policy that is set according to rules, and is lived up to, adds to macroeconomic stability by providing economic agents with expectations of a predictable economic environment. This reduces uncertainty and promotes longer-term decision-making, notably investment decisions, and economic growth. In addition, sound fiscal policies can contribute to lower risk premia on long-term interest rates and thus support more favourable financing conditions for the entire economy.