samchain/econo-pairs-v1 huggingface dataset:
Similar issues of division of responsibility and coordination arise in relation to the issue of supervision of banks' securities business. As you know, this is a somewhat controversial issue because of the exemption that banks and other authorised institutions enjoy from much of the current securities legislation. Although this exempt status is retained in the new Securities and Futures Bill currently going through Legco, the scope of the exemption will be drastically reduced and the banks will in fact be exempt in name only under the new legislation. In future, in respect of their securities business, banks will be subject to most of the same legislation, rules and standards of conduct that will apply to the brokers. These rules and standards will be set by the SFC, in consultation where necessary with the HKMA. The HKMA will act as the front-line regulator of the banks' securities business on a day-to-day basis. That way the banks should normally have to deal with only one regulator, which should make their lives simpler. But, like the MPFA in respect of MPF business, the SFC will remain in the driving seat; and if problems arise in respect of a bank's securities business, the SFC will have the right to conduct its own investigation and to exercise disciplinary powers. There is much more that I could say on the subject of banks' securities business, but that is perhaps best left to another speech.

Since the invention of the credit card in the 1950s, almost all payments by households and businesses in advanced economies have been made through one of four routes: cash, cheque, card or bank-to-bank. Most new innovation to date hasn’t changed that. Even when we tap our phone or watch on an ipad to pay – we’re still generally paying by either card or bank-to-bank transfer. But fintechs, and in some cases big technology firms, are now proposing to change this by using cryptoassets known as ‘stablecoins’ for transactions currently processed by retail or wholesale payments systems. The basic idea of a stablecoin is not dissimilar from a pegged currency. Early forms of cryptoassets such as Bitcoin have so far proved too volatile for widespread use in payments. ‘Stablecoins’ aim to address this by pegging themselves to a fiat currency or basket of fiat currencies. Most propose to maintain reserves or backing assets to defend this peg. While some stablecoins proposals are designed as investment products, most seek stability in pursuit of becoming a new way to pay for goods and services or make peer-to-peer transactions. Many propose to integrate into popular social media or online technology platforms. With this backdrop and an estimated 3 billion social media users worldwide, it’s not hard to imagine that some of these proposals could quickly reach significant scale. 9  including open banking reforms in the EU and the introduction of a payments competition regulator in the UK.
I am confident that this constructive engagement in which regulators across our regional blocs have worked together will continue in other equivalence assessments, such as in the areas of financial benchmarks and organised markets or trading platforms. As we have learnt from past experience, greater clarity in equivalence assessments, including in relation to timing, can help provide greater certainty and thereby support the continued participation of European market participants in overseas markets and vice versa. International standards and peer assessments as basis for equivalence assessment Allow me to highlight one area where international standards and peer assessments have allowed a good basis for equivalence assessment – for financial market infrastructure (FMI). Market functioning, and therefore financial stability, is dependent on the continuity and orderly operation of services provided by these infrastructures. The multilateral nature of FMIs also mean that their services are often cross-border and accessed by a wide range of market participants. Since the development of the PFMI by IOSCO and the BIS Committee for Payments and Market Infrastructures (CPMI), these standards have been used by many regulators including Singapore as a key basis for comparability assessments. CPMI-IOSCO has also been conducting Level 2 assessments of jurisdictions’ implementation of the PFMI. Assessments of the EU, Japan, US and Australia are complete, and assessments of Singapore and Hong Kong are under way. Such peer assessments against international standards will help to promote greater understanding and alignment amongst various jurisdictions’ frameworks. Peer assessments have also helped to identify and close gaps at the entity level.

On the way to price stability, the inflation target is determined jointly with the government. As you know, these targets have been determined and announced as follows: 5 percent for 2006, 4 percent for 2007, 4 percent for 2008 Our primary objective is to attain these targets. The Central Bank will support the growth and employment policies of the Government, unless it conflicts with this objective. Likewise, with the Law No: 1211, the Central Bank has been entrusted with the power of establishing the “exchange rate regime” jointly with the government. The floating exchange rate regime, which was introduced within this framework, will continue to be implemented, preserving its basic implementation framework. Turkey has grasped a golden opportunity to get rid of the damage created by inflation with which it has had to live more than 30 years. The period of “Declining inflation” is about to end. Our next objective will be to achieve and preserve the price stability. This will be the most significant contribution of the Central Bank in mobilizing the growth potential of our country. Thank you. BIS Review 33/2006  1
Liquidity situation is clearly improved with a stable growth in deposits. For that reason, the need of the banking sector for liquidity by the Bank of Albania is substantially reduced. The banking sector is well-capitalised thanks to cautiousness in expanding activities and increase of capital by shareholders. In spite of this good progress of the banking sector, rapid improvement is needed in some areas on which the Bank of Albania has focused its supervisory activity. First area relates to the need for crediting expansion and loan quality improvement. Both elements may support each-other, if careful actions are taken. Crediting expansion will be better supported during 2011, due to two important developments namely, a substantial improvement of the liquidity situation and a falling tendency of interest rates for bank loans in Lek. The first signs of a more positive trend were noticed during the last two months of 2010, with the annual crediting pace significantly accelerated. On the other hand, loan quality remains problematic, although a gradual improvement is expected during the current year. I take this opportunity to reiterate our call on banks to be more active in handling problematic loans and their collection. Concerning loans considered not to have any hope of collection, in conformity with the legal and regulatory framework, banks need to take actions for the execution of collateral. In this process, there is a need for further legal improvements in order to reduce the risk of banks in crediting as well as costs for the client.

Investments in financial assets and real estate – Financial institutions are no longer required to ensure that $ credit facilities extended for investment purposes be withdrawn when the investments are either wholly or partially liquidated. This will relieve FIs of the need to institute additional arrangements to track their non-resident client's investments in financial assets. These measures, which take effect from tomorrow, should pave the way for even greater liquidity and range of activities in the FX, equity and debt capital markets. They should also attract offshore $ activities back onshore. We are still maintaining the two core requirements of the non-internationalisation policy – the restriction on lending for purposes of speculating on the $ and the requirement to swap into foreign currency the proceeds of $ loans, debt or equity issues if these proceeds are to be used offshore. Some market participants have suggested that we should go all the way and lift these requirements too, but we continue to believe it wise to maintain a basic stance of not encouraging internationalisation of the $ through these two requirements. They are unlikely to hinder the activities of legitimate players. They will also provide us basic safeguards in case activity in currency markets turns out not to be self-stabilising, which from time to time seems to be the case. Conclusion The new financial landscape offers many opportunities for the astute market players and investors, but at the same time, presents many challenges for regulators and supervisors.
I would therefore like to comment briefly on our assessment for the next three years, based on the analyses in the most recent Inflation Report published in June (Inflation Report 2/05) and updates at the most recent monetary policy meetings. The economic situation The Norwegian economy is in an upturn and is now expanding at a brisk pace. Inflation remains low, but has edged up since last year. The risk of a fall in the level of prices and markedly lower inflation expectations has diminished. At the same time, there appears to be little risk that inflation will rapidly move up to a level that is too high. The interest rate reductions through 2003 and into 2004 have resulted in low real interest rates. For a period, the real interest rate has been considerably lower than normal. The low level of interest rates is supporting the high activity level in the Norwegian economy. The economic upturn is broad-based. At the beginning of the recovery, activity was primarily fuelled by private consumption, traditional exports and petroleum investment. In addition, growth in mainland fixed investment has gradually gained considerable momentum. Monetary policy easing and low inflation have resulted in strong growth in household real disposable income. Private consumption and housing investment have risen sharply. House prices have continued to rise. Debt growth remains high. The economic upturn has continued this year. High petroleum investment, the international upturn and higher commodity prices have boosted output and earnings in the manufacturing sector.

However, excessive reliance on credit cards to finance personal spending leads to problems. We see this internationally, and in Asia too. The credit card crises in Korea in 2003 and Taiwan in 2006, where we saw significant increases in card delinquencies, as well as debt-related crimes and strained family ties, are reminders. 11. We have so far avoided most of these problems in Singapore, despite growing usage of credit cards. We were an early adopter of safeguards to discourage excessive borrowing on credit cards and unsecured credit,1 and cardholders have generally been prudent. •  Credit card outstanding balances are not high by international standards, and the majority of users pay off their credit card bills in full. Compared to 10 years ago, a larger share of total credit card balances is now paid off in full. And bad debts written off from credit cards have remained stable at 4–5% of average rollover balances. 12 Nevertheless, there is a small group of borrowers who have incurred unsustainable credit card and unsecured debts. MAS estimates that about 3% of unsecured credit borrowers have accumulated unsecured debts that exceed their annual incomes. They are mainly not from the lower income group. Close to 65% of these individuals earn incomes above the median, and more than half hold tertiary education qualifications. 13 As CCS has found, people fall into debt problems for various reasons. Over-spending such as on travel and cars, and job-related changes, are the two most common reasons.
In the days and weeks that followed, banks tightened credit standards on new loans to households and enterprises. Global economic growth was already slowing, but the situation deteriorated in the last few months of 2008. The turnaround hit hard, with synchronised effects on virtually all financial and goods and services markets, not only in the US but also in Europe, Asia, Latin America and Oceania. For a long period there were hopes that growth in China and other emerging market economies would hold up. But they are also now severely affected by the crisis. The world economy is now in the deepest downturn in the postwar period, and will contract in 2009, for the first time in over 60 years. What is happening now is more than a normal fluctuation in the business cycle. The world is facing a crisis of confidence, with faltering faith in the future and a loss of confidence in banks, counterparties and contractual partners. The authorities have taken extraordinary action, as in a state of emergency, deploying a wide range of established and new policy instruments. Banks have been nationalised and state ownership has increased. Central banks have cut policy rates substantially. Government authorities have employed credit easing and quantitative easing to increase the money supply by purchasing private bonds and government debt. Government authorities worldwide have increased budget deficits. In many industrialised countries, deficits will rise to about 5 per cent and for some as much as 10 per cent.

Activity in the economy will be boosted by strong growth in government spending. The projections are based on the assumption that Norges Bank’s interest rate changes will translate into lower lending rates for households and businesses. At the same time, owing to tighter credit standards in banks, monetary policy appears to be somewhat less effective than normal. Inflation is projected to fall below 2 per cent in 2010, before gradually moving up towards the target towards the end of the projection period as the output gap gradually closes. There is a risk that the structural changes brought about by the crisis may result in persistently lower productivity growth and perhaps higher unemployment. It appears that inflation will remain considerably lower in the years ahead than we expected in December. Both the objective of stabilising inflation around the target and the objective of ensuring stable developments in the real economy suggest that the interest rate should be low. Financial architecture In many countries, banks’ share of GDP has increased considerably over the past few years. This share is smaller in Norway than in other countries and, as a result, the Norwegian economy has been less exposed to the financial crisis. Although banks in Norway have not been as oversized as in many other countries, banking still contributes to fluctuations in our real economy. 4  BIS Review 42/2009  Banking is procyclical. In upturns, loan losses are low, increasing banks’ profits. Access to equity capital is ample, providing the basis for strong lending growth.
Low interest rates on loans to households are expected to fuel house price inflation, while prospects for weaker income growth and somewhat higher unemployment may have a dampening impact further ahead. For some time, based on experience from the recent financial crisis, financial stability considerations have to some extent influenced monetary policy. Put in other words: we have been “leaning against the wind”. As a small open economy, Norway is highly influenced by economic developments abroad. Many advanced economies have experienced a difficult time since the global economy was severely hit by the financial crisis. Global growth is expected to pick up. The fall in oil prices is a positive factor for the world economy. But the picture is mixed. In the US, the recovery seems to be on a firm footing. Developments in the UK and Sweden, two of Norway’s major export markets, have also been positive, although inflation remains a challenge. The situation in the euro area appears to be more problematic. A large portion of the workforce is unemployed and production equipment stands idle. Inflation is worryingly low. Through winter, a number of central banks have undertaken unconventional monetary policy easing, and market expectations with regard to key rates in trading partner countries have fallen further. Low interest rates abroad influence the krone and thereby the prospects for inflation, contributing to low interest rates also in Norway. In December last year, Norges Bank cut the key policy rate by 0.25 percentage point to 1.25 percent.

This has mainly been achieved by establishing the sovereign wealth fund and a fiscal rule imposing a constraint on oil revenue spending. The Norwegian parliament passed the Act relating to the fund in 1990. Under the Act, the net budget surplus, including oil revenues, is transferred to the fund, and invested in international markets. The policy guidelines were clarified in 2001 through the introduction of the fiscal rule. Under these guidelines, government spending of oil revenues – measured by the non-oil budget  BIS central bankers’ speeches  1  deficit – is limited to the expected real return on the fund – estimated at 4 percent annually. The idea is to leave the capital in the fund untouched, saving it for future generations. The fiscal rule provided for a gradual phasing in of oil revenues. Over time, we would have to expect the real krone exchange rate to appreciate as a result. However, due to the fund mechanism and the fiscal rule, actual spending is decoupled from current petroleum revenues. This has curbed the appreciation of the krone and thus reduced fluctuations in the exchange rate. Compared to other resource-based economies, the real krone exchange rate has remained relatively stable, especially during the period of substantial increases in oil prices (cf. diagram). Let me elaborate on the transactions that actually take place. All revenues from the sale of oil and gas are originally in foreign currency.
The management of credit risks is cumbersome and neither is it easy to obtain a good picture of the players’ portfolios. Genuine difficulties in making assessments are thus one explanation; another is that in certain cases the banks seem to have hunted with the pack instead of making independent risk assessments. Undervalued credit risks accordingly seem to be a recurrent theme in these crises. It is therefore essentially the banks that must construct sounder credit policies in their institutions. These policies must include the scrutiny of everything from the work of the individual credit officer up to the more general strategies of the executive management and board of directors. A great deal of international work has also been done to rectify these problems. Authorities and financial agents are working together on the formulation and introduction of international principles—core principles—for the proper functioning of banking systems and supervision. One aspect of these efforts is the construction of capital adequacy rules that are more suited to the banking system’s present situation—the current rules were formulated in the light of the financial situation in 1988. Efforts are also being made to achieve a higher degree of transparency and clearer accountancy. The recurrent crises in financial markets unmistakably show that the work of reinforcing the system is a continuous process that must not be neglected. Developments last autumn made it clear that the work the banks had already initiated to improve risk management did not suffice to prevent renewed financial turbulence.

The aim of the CBRT’s road map is to improve the resiliency of the economy to external shocks through (i) maturity lengthening – encouraging banks to shift their non-core liabilities from short-term to long-term; (ii) providing incentives to banks for borrowing and lending directly from and to the Central Bank on times when foreign players are reluctant to engage with banks in Turkey due to heightened volatility in global markets; (iii) bolstering safety-nets – making sure that the banking sector has access to adequate foreign exchange liquidity in times of market stress; (iv) supporting financial stability – providing incentives to banks to improve loan to deposit ratios; and (v) simplifying the monetary policy framework to improve the communication of the monetary policy stance. All but the interest rate corridor simplification step on the roadmap have already been taken and the focus is now firmly on fine-tuning their parameters. Overall, these measures ease the policy tradeoffs posed by the excessive volatility in cross border flows, enabling the interest rate policy to concentrate on the primary objective of price stability. So far the financial market performance of Turkey suggests that the measures undertaken since August 2015 have helped Turkey outperform many peer EM countries. Of course, on the way, Turkey also enjoyed the benefits of lower oil prices relatively more than many EMEs and reduced political uncertainty after the general election result in November 2015.
So the message is: consumers of financial services have to be responsible for the decisions they make and the consequences of such decisions. Think twice before you sign on the dotted line. Conclusion To conclude, the key takeaways are: •  banks must treat customers fairly by looking after their interests and not treating them just as target of sales; and  •  bank customers must learn to become “smart” as well as “responsible” consumers of financial services. Then how do we go about in achieving these two objectives? For banks, the HKMA will ensure that there is a set of robust but fair rules governing banking conduct. We will enforce these rules vigorously through on-site examinations and off-site surveillance. We will investigate and, if appropriate, take enforcement action against breaches when they are reported by customers or detected by the HKMA. But we appreciate no external forces can be as effective as internal controls and culture in guarding against breaches. We therefore consider it important for the boards and senior management of banks to share and cherish the same value as we do in terms of treating customers fairly.

In order to become a smart consumer he must try to understand the nature of different kinds of banking products and to avoid those products that go beyond his risk appetite or personal financial capability. This relates to the “smart” part. On the “responsible” part, it is important that when a person takes out a loan from his bank, whether to shop or buy a flat, he should fully assess his repayment capability in relation to his income and expenses. There is not much point in blaming the bank in granting you easy and cheap credit when you have overstretched yourself in exuberant spending or in taking excessive risks in properties or stocks. In the context of buying investment products from a bank, the customer must realise that he is bound by his signature on the agreement, and that he cannot imply obligations which are contrary to the express terms of an agreement. Put it simply, a customer may not succeed in civil litigation for investment losses on the ground that he did not fully understand the terms of the investment contracts. Recent court cases in Hong Kong have clearly demonstrated that the existence of mis-selling by the bank would be a relevant factor in determining the culpability of the bank, but the customer must not harbour the expectation that mis-selling, regardless of its nature and severity, would necessarily lead to full compensation for investment losses.