samchain/econo-pairs-v1 huggingface dataset:
This scheme comes in two parts; the first relates to concessional financing support while the second concerns the State’s guarantee of the financing. Central Bank of Kuwait - Public ‫ عام‬- ‫بنك الكويت المركزي‬  -7-  Part One: support to cost of financing This program was designed to support cost of financing (return/interest) granted to SMEs and cost of financing given to companies. In line with the nature of SMEs and their unique needs, the scheme subsidizes cost of financing at a maximum of KD 250,000 per customer. This support covers part of the financing where the State shoulders the full cost of the financing for the first two years, 90% of the cost for the third year, and 80% for the fourth. The scheme specifies the purpose of the financing as meeting periodic contractual dues and expenditures, such as payroll and lease payments, with a term of up to four years. It meanwhile keeps cost of financing at a low level (discount rate as specified by the CBK + 1%), which currently comes to 2.5%. As for eligibility for financing, the program covers SMEs affected by the COVID19 pandemic that had been performing well and enjoyed a good position prior and excludes entities whose parent companies have alternative sources of financing. The scheme also requires the entity to retain current national staff and meet the Kuwaitis employment quotas to be met by end of 2021 for the relevant sector in which it operates.

It also dropped the interest rate to a historical low of 1.5%, which reduces the cost of financing for entities granted such support and stimulates economic growth. As a result of these steps, the banking sector now has high liquidity levels and maneuvering capacity that enable it to fulfill its duty as financial intermediary. Central Bank of Kuwait - Public ‫ عام‬- ‫بنك الكويت المركزي‬  -6-  The Role of the Government: The role of the government takes on an even greater importance amid the current conditions. The lockdown measures caused an unprecedented shock to both supply and demand, this coincided with a sharp decline in oil prices that brought down government revenues. The Committee was therefore keen to provide maximum support to guarantee that the economy keeps running, while simultaneously reducing cost to public funds to a minimum, through the proper allocation of resources and reliance on measures that have the biggest impact with the least cost possible. Among these measures was drawing up a government financing support and guarantee scheme, which was presented to the Council of Ministers by the Committee on 5 June 2020. Government financing support and guarantee scheme: The committee forwarded a proposed government financing support and guarantee scheme to the Council of Ministers to decide and take appropriate action in this respect.
Notwithstanding the success of foreign exchange markets in processing the initial referendum news, the second lesson comes from the flash crash. It emphasises that central banks need to deepen their understanding of the features of modern market structures that exacerbate these vulnerabilities and why they seem to be occurring across a broader range of markets. In particular, we need a deeper understanding of the potential for flash events to have longer-lasting consequences than has been the case so far. That would increase the potential systemic costs of flash events and increase the case for some form of public policy response. In the Bank’s context that helps explain why the Financial Policy Committee is seeking to examine the potential implications of these developments for financial stability. I am sure that there are many broader lessons from 2016 that OMFIF will help us all work through, and look forward to benefiting from those insights, but for now, thank you.

The steps required to mitigate the inflation risk through sterilization can involve big fiscal costs.4 Neither option is attractive, though the former strategy of currency appreciation is much less problematic if other EMEs are acting in a similar manner. Meanwhile, we all have to bear in mind that current circumstances put stress on the support for open global markets in the developed world. On the U.S. side, the recovery remains distinctly subpar in spite of aggressive monetary and fiscal stimulus. On the monetary policy front, short-term rates remain near zero and the Federal Reserve is just about to complete its $ billion Treasury purchase program. On the fiscal policy front, the U.S. government has engaged in large stimulus program. This supported demand and employment while the private sector shifted its saving balance into surplus in an effort to repair balance sheets. However, the large size of the fiscal deficit and the rapid increase in the country’s federal debt-to-GDP ratio means that this is not sustainable for much longer. Ultimately, the composition of economic activity in the United States needs to be rebalanced. There are two issues here. First, the consumption share of GDP may still be too high. 3  In nominal dollar terms Chinese exports rose 20 percent annually from 2000 to 2010. The Federal Reserve Bank of New York estimates volume growth of about 18 percent. 4  EMEs typically issue sterilization bonds to offset the increase in the money supply caused by foreign exchange intervention.
At this point in my speech, I would like to underline that price stability has not yet been achieved in Turkey. As I have just mentioned, significant distance has been covered in the fight against inflation. However, it is a fact that inflation is still relatively high in Turkey compared to fellow developing countries. The process of the fight against inflation still continues. Within this framework, there are certain factors that need to be paid attention to, for price stability to be achieved in the upcoming period. The first one of these is ensuring that the increase in domestic demand continues to materialize in a controlled fashion. The second factor I would like to emphasize is avoiding reform fatigue. Several structural reforms have been made in the Turkish economy up until now. Yet there are still more reforms pending. . It should be remembered that maintaining the reforms made up to this point is not sufficient to attain positive outcomes from them, but making new reforms is also equally important. The third factor that requires attention within the framework of achieving price stability is the susceptibility of established economic balances to expectations. Therefore, developments that may adversely affect expectations should not be allowed to occur. The last factor that should be taken into consideration in this respect is the fact that since policymakers, both agricultural, cannot control them and energy prices may at times have adverse effects on the course of inflation.

This means that a single European scheme is not an essential component of Banking Union in the short term. Key features of the SSM Finally, there is of course the Single Supervisory Mechanism, or SSM. As you know, progress here is already well advanced: the Regulation setting up the SSM has already been approved by Council and is now being discussed by the European Parliament. So what are its key features? Above all, the SSM will be one system. Some commentators have claimed that, because the SSM is decentralised, nothing will change and supervision will remain essentially national. This is not correct. The ECB will be the legally competent supervisor for all banks in  BIS central bankers’ speeches  3  participating countries. It will have direct supervisory powers over large, systemic banks, which we estimate to number around 140. We will not directly supervise the thousands of remaining smaller banks, because this would be inefficient when national supervisors are already in place with the necessary knowledge and technical skills. But the ECB and the national supervisors will act as a single system. To ensure cohesiveness, all the components of the system will have to act in accordance with guidelines, ECB specific regulations and manuals of supervisory practices that will be approved by the Supervisory Board. Moreover, the ECB will receive supervisory data on all banks in the SSM allowing it to keep track of developments across the system.
Individual banks will still have different methodologies for arriving at the inputs based on their reasoned assessment of risk, and banks’ estimates will clearly vary according to their business strategies and the nature of their portfolios. Concerns that Basel II will be destabilizing for emerging markets Another charge leveled at Basel II is that increased capital requirements for lending to emerging market economies will cause banks to reduce credit extensions. Here I think it is particularly important to consider the current reality of banks’ decision-making processes. Internationally active banks are not currently making lending decisions primarily on the basis of Basel I capital requirements - rather, they are using their internal risk ratings systems and economic capital models for pricing and lending decisions. These internal models and capital requirements are far more constraining than Basel I requirements. Therefore, when we try to gauge the impact that Basel II will have on emerging market lending, the pertinent comparison is not with Basel I, but with the internal risk ratings and economic capital systems that internationally active banks now use. As such, we do not expect major changes in international lending as a result of Basel II requirements. Additionally, Basel II will bring stabilizing benefits to emerging markets that are often overlooked. The sharp distinction in capital charges for longer-term lending versus short-term loans under Basel I has created some distorted incentives, particularly with regard to emerging market lending.

I should emphasize that the weaknesses of the current regulatory capital framework are much more relevant to the supervision of the largest and most sophisticated banks than they are generally across the industry. For the vast majority of the thousands of U.S. banks, the existing regime largely works. In recognition of this, among other considerations, we expect that in the U.S. most banks will stay on Basel I while the largest and internationally active banks will adopt the advanced Basel II approaches. We are considering some simple adjustments to Basel I to ensure that the framework is up to date and that there is competitive equity with Basel II adopters. In any event, the lack of risk sensitivity and incentives for arbitrage have made Basel I less relevant in our supervision of the largest banks - it is a benchmark requirement to be met, but not, in practice, a critical discriminating factor as we judge their financial condition. As supervisors, we have focused increasingly on assessing the rigor and effectiveness of each organization’s risk management and control systems. We have looked to understand the risk appetite of each firm, and then assess how well it is able to measure and manage the resulting degree of risk taking. A key recent part of the supervisory effort has been to encourage the development of banks’ internal economic capital models - models that link risk taking to capital and that look to compare risk taking, and the returns on risk, across business lines, regions and products.
The reduction of the requirements for liquid assets by banks may be carried out without infringing the stability of the system, since their level is generally higher than that of international standards and of banks in the region. Moreover, given that banks operating in the country have their origin mainly in Europe, this reduction may take place under the conditions of declining risk premia in European financial markets. However, it will be  4  BIS central bankers’ speeches  monitored and implemented according to each bank’s risk profile. This means that though the reduction may be general, the level of liquid assets requested by currency and in total may be different in different banks. Change in the risk coefficients of the investment structure will take place, so that banks’ capital better supports the shifting of their resources toward lending. More specifically, we propose significant increase in risk coefficients that are used for calculating the banks’ capital, for new flows of bank investments with non-residents. This increase in risk coefficients may take place also for part of bank investment stock with non-residents, taking into consideration: •  Regulatory requirements for liquid assets;  •  Adequate coverage of bank liabilities to non-residents; and  •  The time needed so that this shift does not cause any operational overburden to banks. On the other hand, risk coefficients may decrease in banks for the amount of new credit added to the existing stock, for a certain period of time.

Zeti Akhtar Aziz: Regional integration and global integration – is there a conflict? Speech by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Official Monetary and Financial Institutions Forum Kuala Lumpur Debate, Kuala Lumpur, 20 March 2015. *  *  *  It is my great pleasure to welcome you to the inaugural Kuala Lumpur Debates, which is being held on the side of the 19th ASEAN Finance Ministers and Central Bank Governors Meetings. It is envisaged for this to be the first in a series of KL Debates intended to serve as a strategic forum for policy makers, industry players as well as members of the public to constructively discuss the key issues confronting the economies of our region and thus to facilitate greater understanding as we work towards building stronger foundations for sustainable growth. The motion that is put forward for debate today is “Regional integration and global integration: is there a conflict”. The debate format is chosen to allow both points of view to be heard, thereby ensuring a balanced discussion and evaluation of the issues. This topic is highly relevant to ASEAN as there have been various views on ASEAN integration and what it means for the rest of the world.
Ranee Jayamaha: Role of external auditor and implications of the new Companies Act Speech by Dr Ranee Jayamaha, Deputy Governor of the Central Bank of Sri Lanka, at a seminar at the Central Bank of Sri Lanka, Colombo, 11 June 2007. *  *  *  Given the rapidly expanding financial landscape in Sri Lanka in which finance and leasing companies are making a significant contribution to the financial services industry, it is imperative that the role of each stakeholder is recognized for purposes of clarity, financial reporting and in the interest of wider financial system stability. The business of finance, hire purchase and leasing has grown significantly in the last few years, but at a lower pace than that of the banking sector. In 2006 alone, the growth in leasing portfolio of banks was 80%, while the finance companies and leasing companies recorded growth rates of 13% and 6%, respectively, in their lease portfolios. Banks and finance companies have access to low cost funds through deposit mobilization. Here too, banks have current accounts at zero costs. Leasing companies, on the other hand, rely on bank borrowing or borrowing through debt instruments which is costly to them. Recently, the Central Bank has recommended amendments to the Leasing Companies Act to regularize leasing company borrowings from the public through the issue of debt instruments.

Arguably, this is more of a communication issue than one of actual policy, and less emphasis on the readiness to clean up after a sharp fall in asset prices might have been a preferable alternative. The International Monetary Fund (2009, Chapter 3) has investigated the role of monetary policy in causing financial crises. A large number of countries and financial crises were included in the sample. The conclusion is that “the stance of monetary policy has not generally been a good leading indicator of future house price busts… There is some association between loose monetary policy and house price rises in the years leading up to the current crisis in some countries, but loose monetary policy was not the main, systematic cause of the boom and consequent bust.” Further-more, the overall relationship between the stance of monetary policy and house-price appreciation across countries in the years before the current crisis is statistically insignificant and economically weak, and monetary policy differences explain only about 5 percent of the variability in house price appreciation across countries. 13 Lessons for flexible inflation targeting What conclusions can we draw so far from the financial crisis about the conduct of monetary policy and any need to modify the framework of flexible inflation targeting? One obvious conclusion is that price stability is not enough to achieve financial stability (Carney 2009, White 2006). Good flexible inflation targeting by itself does not achieve financial stability, if anyone ever believed that. Specific policies and instruments are needed to ensure financial stability.
In particular, the non-performing loan ratio for lending to the resident private sector, in business in Spain, stood at 5.3% in June 2019, down 8.7 pp from the high levels recorded in December 2013. Foreclosed assets, meanwhile, have fallen continuously during the years of recovery; a total cumulative reduction of 50% from the peak levels recorded in 2011 had brought them down to below € billion by June 2019. As I was saying, this progress should not cause us to forget that the Spanish economy has significant imbalances, among which the still high levels of unemployment, government debt and external debt stand out. Since the start of the recovery progress (of varying intensity) has been seen on these fronts, but the magnitude of the imbalances built up in terms of the stocks of these variables means that they still amount to vulnerabilities (to turbulence in international markets, for example). At the same time, the Spanish economy’s growth capacity continues to be constrained by its very poor productivity dynamics, which is particularly worrying insofar as it will also be adversely affected by the impact of population ageing. Main challenges facing the Spanish economy  Turning to focus on the labour market, as you all know, the Spanish economy’s rate of unemployment remains very high, at around 14%. Also, around 45% of the unemployed have been seeking work for a year or more, a factor that reduces their likelihood of success.

8/18  There thus seems to be a need to improve the employability of this more vulnerable group notable for the presence of very young and very old workers, as well as individuals with fewer skills. To do this, it would be desirable to increase the human capital of these workers, a task which, in particular, would need training tailored to employers’ requirements. Furthermore, it should not be overlooked that the higher inequality in household income emerging in the crisis was, above all, a consequence of job destruction, which underscores the need to ensure that these people can get a job as soon as possible. In addition, the incidence of temporary employment remains very high (nearly 27% in the third quarter of 2019), which, among other things, makes for high employment volatility and reduces worker productivity. Main vulnerabilities of the Spanish economy  A second source of vulnerability originating as a legacy of the crisis is the high government debt, which in the second quarter of 2019 stood at around 99% of GDP, more than 60 pp above that in 2007. It is in this terrain where headway has been less satisfactory in the last few years, as evidenced by the fact that the budget deficit continues to have a high structural component, estimated by the European Commission at above 2.5 pp of GDP.
But with an inflation target of 4% or even more, we cannot exclude that mechanisms that automatically recover purchasing power are going to be developed. It is not difficult to picture a scenario in which we could end up having more wage inertia due to indexation. In addition, inflationary expectations could become more volatile. This, in turn, will significantly reduce the gains of having a higher inflation target in the first place. A credible commitment to stable inflation also generates greater stability of the business cycle, allowing less costly unemployment fluctuations. Indeed, a reason for the great moderation the global economy experienced for an extended period of time was in part due to a better management of monetary policy and not only to good luck. 3 Therefore, a credible commitment to price stability increases welfare by reducing both, inflation and unemployment volatility. Despite the big consensus regarding the need to preserve price stability as a central goal of monetary policy, some analysts have argued that such a concept should be expanded to include asset prices. By allowing significant deviations of asset prices from their “fundamentals”, central banks planted the seeds of financial crisis. Therefore, it has been argued that monetary policy should respond to asset prices. I think this approach is too narrow. As I already mentioned, the financial crisis was not only related to the burst in asset prices but mainly to its interaction with financial fragility. Asset price bubbles and financial fragility are part of a more complete (and complex) concept: financial stability.

Central banks have been carrying out significant efforts in order to improve the monitoring of the financial sector in the form of financial stability reports. Based on our recent experience we know that close monitoring of asset prices, credit flows and the current account deficit is required. Moreover, substantial work also needs to be done in monitoring the vulnerabilities of both bank and non bank agents – including financial intermediaries, firms and households. Finally, understanding interconnections in the financial system – be they via balance sheets, asset markets or risk perceptions – is also a key component of financial stability monitoring. The challenges in doing all of this are both conceptual and practical, as we often rely on a statistical toolbox best aimed at capturing macroeconomic trends and less suited for the analysis of the whole distribution and, in particular, tails risks, which are crucial for financial stability analysis. Although most central banks have an explicit financial stability objective, for some of them it was a secondary issue for many years, as GDP was growing strong and banks and firms displayed sound balance sheets. Now things have changed dramatically. As of last year, financial stability became the key factor driving monetary policy management in developed countries. It should remain at the same level of priority as price stability in the future to avoid a repetition of recent events.