samchain/econo-pairs-v1 huggingface dataset:
For most cross-border mergers, the business case is more difficult to anticipate in the current competitive landscape. Admittedly, too, there are certain cultural, institutional and regulatory obstacles that hinder the emergence of a truly European banking market. The resistance to removing these obstacles largely imply preserving ring-fencing structures at national level, limiting or even impeding the free flow of capital or liquidity across borders. 3/5  In my view, after achieving a significant reduction of risks in the financial sector as well as a complete pan-European decision-making process, it would be time to call for an end to these national ring-fencing supervisory practices, which are detrimental to financial integration and, thus, limit the ambition of the BU as a single jurisdiction. The implementation of the SSM and SRB may be seen as a remarkable achievement. But we must acknowledge that the BU still lacks one of its three main pillars, the European Deposit Insurance Scheme (EDIS). At a minimum, a building needs three pillars to ensure its structural soundness; likewise, I believe that the EDIS would contribute to making the BU more stable, particularly in times of stress, which is in fact when the resilience of structures are tested. Certainly, a fully-fledged mutualised EDIS would have a strong impact on citizens’ trust; but, in addition, a greater degree of risk-sharing within the euro area would also help align financial responsibility with the pan-European decision-making process, already in place in the areas of banking supervision and resolution.

Of course, the Banking Union is now an integral part of the Euro project. In fact, like pillars in a building, the BU provides resilience and stability to the whole Euro project. As such, the BU is in its own right one of those transformative developments that have contributed to deepening our level of integration. 2/5  However, unlike the single market or the adoption of the euro, the BU was not the result of a joint vision by EU leaders on the need to enhance banking supervision and resolution across the Eurozone. Instead, it was the outcome of bold and swift defensive reactions to preserve the single currency in the wake of the European financial and sovereign debt crisis. Indeed, it was the crisis that led to the conviction that a common and enhanced framework for banking supervision and resolution was needed to help break the link between banks and sovereigns. This conviction gave rise to the Single Supervisory and the Single Resolution Mechanisms, which, so far, are the key components of the BU. Another important development related to the Single Resolution Mechanism came to fruition last December, when the European Stability Mechanism was recognised as a common backstop to the Single Resolution Fund for both solvency and liquidity support. Today the rationale behind the creation of the SSM and the SRB seems obvious. But, to be fair, before the European sovereign crisis erupted, there had been only a few warnings against the risks that a fragmented banking supervision landscape within the Euro area involved.
This situation was compounded by weak economic data in the first half of 2011, which pointed to the risk of another global recession. Swiss franc appreciation accelerated in response to these developments, with the currency reaching historic highs against the euro and the US dollar and threatening to plunge Switzerland into a deep recession (cf. chart 3). The discontinuation of the minimum exchange rate in January 2015 The minimum exchange rate – which was to remain in place for almost three and a half years – halted the appreciation of the Swiss franc and helped to ease tensions. When we discontinued the measure in January 2015, the decision was criticised in some quarters. This is understandable, as the scale of the minimum exchange rate’s negative side effects was not yet fully apparent. However, the discontinuation of the minimum exchange rate was  BIS central bankers’ speeches  3  unavoidable; conditions had changed and an analysis of the risks clearly favoured the decision to remove the floor. The overall situation had improved significantly since the introduction of the minimum exchange rate. The economy had regained momentum, confidence in the US dollar had been restored and uncertainty had decreased considerably. Then there was the issue of divergence: the monetary policies of the US Federal Reserve and the ECB were moving in opposite directions. As the markets were expecting the Americans to tighten and the Europeans to substantially loosen monetary policy, the euro had been weakening against the US dollar since mid-2014.

The federal guarantees for the COVID-19 loans and the liquidity provided at favourable conditions by the SNB have contributed towards Switzerland being able to avoid a credit crunch in the past few months. Page 3/4  Zurich, 17 December 2020 Thomas Jordan  News conference  It will take some time yet before the economy recovers, and uncertainty will remain high for the time being. We will therefore be seeking to do our utmost with our monetary policy to ensure price stability and to contribute to the economic recovery. Climate change and the SNB  I would now like to talk about the significance of climate change for the SNB. We have been working intensively on this topic for some time now. We want to properly assess possible consequences of climate change for the economy, for financial stability, and for the management of our foreign exchange reserves in order to ensure that we can fulfil our statutory mandate at all times. To this end, we also collaborate with other central banks, in particular in the Network for Greening the Financial System (NGFS), and we work together closely with FINMA. As regards monetary policy, we are continuously deepening our analysis into how climate change could affect economic growth and inflation. The dialogue with other central banks is particularly important in this area. When it comes to financial stability, the SNB focuses its efforts on determining the impact of climate risks on the stability of the Swiss banking system.
Second, regulation and crisis management were handled at the national level, despite the rapid internationalisation of the financial markets. Third, surveillance focused on individual institutions and if these were stable separately it was often concluded that the system as a whole was stable. An important reason for these shortcomings was that there was an unclear allocation of roles and no organisation with an explicit mandate to oversee, identify and analyse risks in the global financial system. The IMF was also criticised for its actions in the run-up to the financial crisis. The IMF’s own independent review body, the Independent Evaluation Office (IEO), has said that before the crisis the IMF, like many others, was convinced that the risk of serious crises was practically non-existent.2 This was apparent, for example, in the overconfidence in the health and resilience of the major financial institutions. Risks that are generally related to construction booms and financial innovations were toned down, as was the need for strong regulations to prevent such risks. It was not until the spring of 2008 that the IMF’s Global Financial Stability Report warned against emerging vulnerabilities among the major financial institutions, but by that time the crisis was already a fact. In response to the crisis, more distinct frameworks for the oversight and supervision of the financial system at the national and regional levels are now being developed.

How this policy should actually be carried out in practice is a complicated issue and I believe that the IMF can play an important role in this context too. The financial crisis revealed major problems The era in which we were said to be living in the best of all possible worlds, popularly known as “The Great Moderation”, came to a disastrous end in 2007. Following a long period of steady growth and stable low inflation, we had been lulled into the belief that this would never change. We believed that the financial markets were excellent at converting savings to loans and distributing risks so that they were taken by agents who both wanted and were able to  1  The Nordic-Baltic constituency consists of Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway and Sweden. BIS central bankers’ speeches  1  bear them. The risks that were mainly discussed were the imbalances in the global economy in the form of countries with large current account surpluses and those with corresponding deficits. Those who raised questions about the stability of the global financial system and the risks relating to a rapid expansion of credit found it difficult to be heard in this situation. The financial crisis brought into focus the inability of the international community to prevent and manage crises in the global financial system. There were several problems. First, there was a lack of knowledge about the links and the contagion risks in the financial system.
But one of the roles of, and indeed justifications for, regulation is to ensure that firms also take sufficient account of the interests of others who would be adversely affected by their failure: their own borrowers and depositors, for example, but also the customers of other banks that would suffer losses if a particular bank were to get into difficulties. In other words, one purpose of regulation is to align private choices with public welfare maximisation. Hitherto, public authorities have placed much emphasis on capital requirements as a way of achieving this reconciliation. Indeed, one reason for imposing capital requirements is to limit the risk of liquidity problems, by giving the market a level of assurance over the solvency of a firm. But this emphasis on capital has perhaps overshadowed the importance of direct liquidity requirements. Analytically, liquidity is a more difficult area. But arguably the case for prudential liquidity requirements in some form is just as strong as for capital. Liquidity cushions are a first line of defence: in times of stress they can buy time, and where organisations are solvent they can help to prevent liquidity problems turning into solvency ones. I will return to this later. But besides regulation, the public authorities—specifically central banks—have a crucial role as the ultimate providers of liquidity. They therefore need to ensure that they are properly equipped to carry out this function.

Yet there is no equivalent of a World Trade Organisation to deal effectively with the problems that inevitably would spring up, even though the degree of complexity and time criticality of international finance far exceed that of international trade. There is, of course, the IMF, and the Bank for International Settlements (BIS). They perform useful roles respectively in providing assistance to individual economies in difficulty, and in setting international regulatory and supervisory standards, and they have done a good job in these areas. But, as very much part of the international financial architecture, they need to evolve to cope with the rapidly changing nature of international finance. They need to ensure that they are able to play the roles required of them in prudently managing the risks, and limiting the destabilising impact, of the increasing freedom of international finance. There is much catching up to do, and much international effort has been devoted to this task. But, presumably because of the difference of opinion on what exactly needs to be done, we now have a rather confusing picture of where all this effort might lead us to. There have been many new international forums created to look at the relevant issues and, together with the existing forums, everybody seem to be involved in this work - G3, G7, G10, G22, G26, APEC, EMEAP, etc., with multiples of working groups formed under each. More recently, there is the more authoritative Financial Stability Forum formed, in which the HKMA participates.
Second, without violating the culture of observing the contractual obligations, it should be more active in the loan restructuring process to provide more room to businesses deserving it. Third, we think that Albania has in place business and development projects of a long-term interest that deserve greater attention. Lack of the loan demand is an already-known and well-understood problem. However, the banking system should be more flexible when assessing the submitted applications. In all my public pronouncements, I have iterated the prudence needed for sound public finances in the country. We deem that the country’s sustainable development economic paradigm requires taking swift measures for making the public finances healthier. Beyond the short-term challenges about the current year’s budget, putting in place a  2  BIS central bankers’ speeches  reliable and transparent fiscal rule is a necessity to discipline the fiscal policy in the long term and guarantee the trust of the financial markets in the Albanian public debt. Finally, the Bank of Albania deems that the macroeconomic stimulus should continue to be based on a stimulating monetary policy and a banking system more focused on the needs of the economy. Also, we believe that the fiscal policy lacks the room for such actions. This action path preserves the macroeconomic stimulus and the soundness of macroeconomic balances, hence providing the shape to the first pillar of development policies. 2. Second pillar: Reducing uncertainty in economy  The second pillar (of a short-term action, as well) relates to reducing uncertainty in the economy.

Currently, Albania meets all the conditions for a fast convergence with the European Union. I also think that the European integration is the best way to withstand the current crisis and guarantee stable economic growth in the long term. The Bank of Albania, being an integral part of the Vienna II Initiative, is greatly committed to the process of reshaping the financial structure supporting the development of South-Eastern Europe. Thanking you for your attention, I am open to further discussions. BIS central bankers’ speeches  3
Unlike earlier episodes of high oil prices, which were driven largely by temporary supply constraints, the recent increase in the demand for oil has been reflected in higher prices for future delivery as well as higher spot prices. Similar rises are apparent in the market for gas. The signpost marked higher energy prices points us towards ways of using less energy, to alternative energy sources and to new sources of oil production such as the Canadian tar sands. BIS Review 9/2006  1  The first two signposts point us in the right direction. But the path has not been easy to follow. We have seen movements - in both directions - in inflation, consumer spending and output growth. Interest rates too have moved both up and down in order to maintain overall stability of the economy by keeping consumer price inflation close to the 2% target. The reasons for those changes have been explained in the minutes of the Monetary Policy Committee meetings and in our Inflation Report. Tonight, I want to look a little further ahead, to the challenges for monetary policy posed by a third signpost - the recent fall in long-term interest rates. The development of an integrated world capital market means that these now depend on savings and investment decisions elsewhere in the world as well as here at home. Investors seem to be willing to lend to governments at much lower interest rates than for many a year.

We had to manoeuvre through uncharted waters and we may not yet have arrived in the Promised Land”. It is obvious that for a smooth economic catch-up it is important to maintain a long-term perspective and to implement coherent policies and reforms. 3/4  BIS central bankers' speeches  Past achievements in nominal and real convergence, while significant, do not guarantee future success (for instance, joining other countries in the middle-income trap is a real danger). A realistic and balanced approach to euro adoption implies that it should be steered taking into consideration absolutely all relevant elements for the sustainability of economic convergence. It is the only way we can safely sail to the port of destination… Thank you for your attention and I wish you lively, yet equally fruitful debates! 4/4  BIS central bankers' speeches
The interdependence between the different components can be seen in cases where Islamic banking relies on takaful operators to provide protection and coverage for Islamic financing products offered by the Islamic banks. In the case of takaful operators, they would rely on the Islamic banks, through bancatakaful arrangement, to have automatic access to the banks' wide customer base and to leverage on the banks' reputation and prominent position to effectively distribute takaful products. The Islamic capital market will also depend on the takaful operators, and to some extent the Islamic banks, to participate in subscribing to Islamic financial instruments which fulfil the medium to long-term financing needs. In return, the adequate supply and availability of a wide range of financial instruments offered in the Islamic capital market has facilitated takaful operator to effectively manage its asset portfolio to match the liability and risk profile of the takaful fund as well as enhances the ability of takaful operator to generate attractive investment return to stakeholders. 9. Allow me now to take this opportunity to share with you Malaysia's experience in the development of the Islamic financial system that has earned Malaysia, Alhamdulillah, the recognition by the  2  BIS Review 13/2006  international financial community as a leading Islamic financial hub. In developing the Islamic financial system, Malaysia has adopted a phased-in approach which can be divided into three different phases.

This event is especially important as it touches on new areas such as the regulation and supervision of the takaful industry as only minimum guidance is currently available. Ladies and Gentlemen, 3. Before I continue with this keynote address, let us all take a moment to remember Allahyarham Dr. Mohamed Aboulkhair Zaki Badawi, a great thinker and collaborator for the cause of Islam, and particularly in the area of Islamic finance . He has devoted so much of his time and energy for the benefit of the Ummah. We will always remember his numerous contributions to the development of Islamic finance. We cherish his involvement, among others, in the introduction of Shariah-compliant mortgage, the establishment of the Shariah council to reconcile conflicts between Islamic and conventional laws and the establishment of the first Islamic financial institution licensed in the United Kingdom. In Malaysia, he has made his mark a long time ago with efforts in setting up a dedicated Muslim College and the teaching of Islamic Studies at the University of Malaya, Malaysia. He was also involved in the development of Islamic finance in Malaysia by being the Shariah advisor to RHB Islamic Bank and the Labuan Offshore Financial Services Authority. In appreciation for his contribution, let us pray that God Almighty grants him a place in His paradise with the prophets, the martyrs, and the righteous, insyaAllah. Ladies and Gentlemen, 4.
Moreover, although supply bottlenecks are easing, they are still limiting activity in certain sectors. That said, the euro area economy is expected to grow by 3.1% in 2022, before slowing significantly in 2023 to 0.9% – vs the 2.1% forecast in June. In 2024 GDP is expected to grow by 1.9% (2.1% in the June forecast). Inflation continues to be driven by the surge in gas and food prices, demand pressures in some sectors owing to the economic reopening, supply bottlenecks and the depreciation of the euro. In addition, slightly stronger wage growth is expected, in the context of a robust 13  For more information, see C. Martínez-Carrascal (2022). “The impact of the surge in inflation and the war on Spanish households’ economic outlook”, Economic Bulletin 3/2022, Banco de España. 6  labour market, higher minimum wages in some countries and the delayed effects of past high inflation rates. These factors more than offset the negative impact on inflation of the weaker growth outlook. As a result, inflation projections have been revised significantly upwards, although inflation is expected to decline as the current inflation drivers gradually abate and the normalisation of our economic policy passes through to the economy. The forecasts now put inflation at 8.1% in 2022, 5.5% in 2023 and 2.3% in 2024, an upward revision of 1.3 pp, 2 pp and 0.2 pp, respectively, with respect to the June projections. In the case of the Spanish economy, the Banco de España will update its latest projections in early October.

It is now well accepted that there are deep and fundamental causes for that prolonged coincidence of low interest rates and low inflation. In advanced economies, and possibly worldwide, equilibrium real interest rates have dropped to very low levels. Falling equilibrium rates may require zero or negative policy rates and, more broadly, very accommodating monetary conditions that conventional instruments cannot deliver. Hence the development of non-conventional monetary policies in all our economies. Part of the fall in equilibrium rates is a consequence of the crisis and the subsequent deleveraging and balance sheet repair that is taking place in many sectors of the economy. Part may predate the crisis itself and result from shifts in global desired saving and investment. Whatever the causes, low equilibrium rates complicate the task of monetary policy. Because of the zero lower bound on nominal rates, they constrain the ability of central banks to react to negative cyclical shocks. They may lead to cumulative downward spirals if low inflation keeps real policy rates above the equilibrium level. In addition, the perceived inability of monetary policy to keep inflation close to the objective may fuel pessimistic expectations, a point to which I shall return. Over the last two years it has become increasingly apparent that all those risks are materialising in the euro area. Finally, low equilibrium rates worsen the trade-off between price and financial stability. Policy rates must be brought down for price stability to be preserved.