samchain/econo-pairs-v1 huggingface dataset:
(a) The distribution of risk weights under IRB within each LTV band is represented by the boxplots: the box is the interquartile range and the whiskers are the most extreme observations still within 1.5 times the interquartile range from the upper or lower quartiles. 20  All speeches are available online at www.bankofengland.co.uk/speeches  20  Table 1: Timeline for implementation of CRD V, CRR II, CRD V, and Basel III Regulation  Implementation date  CRD V Pillar 2 micro- and macroprudential tools (e.g.

Lastly, judging from the performance of macroeconomic factors, economic growth was also sustained by a stimulating financial environment, more favourable performance of our trading partners, improved balance sheets, and a more optimistic view of enterprises and households on the outlook. All the above reasons fuel the optimism on the perspective of economic growth in the next year and onward. Albania has reached, among others, an important milestone on its path to development and integration: the expected opening of accession negotiations with the European Union. These negotiations should surely be viewed as an important development anchor and an additional guarantee for both domestic and foreign investors. The year just ending confirmed the stability of the Albanian banking sector. It may be considered as a special year in view of important structural changes in the system, which are expected to be finalised in the next year. Banking activity continued to expand, and the banking sector continued to be well capitalised, liquid and profitable. The NPL ratio continued to improve, hitting a new record low for the last eight years, standing at 12.89%, in September. Meanwhile, deposit growth was channelled mostly into investments in securities and less into lending. Certainly, the appreciation of the exchange rate and the lost loans write off provided a statistical effect on the indicators of credit performance. Also, credit in the national currency continued to prevail over the foreign currency credit. Nonetheless, the overall level of credit to the economy is still far from its potential and the opportunities for expanding lending abound.
Conclusion I think I’ve covered a lot of ground in my remarks this morning. I look forward to continuing our dialogue in the coming year – and appreciate the opportunity to talk with you this morning. Thank you. BIS central bankers’ speeches  7

A New Horizon  Speech given by Mark Carney, Governor Bank of England  European Commission Conference: A global approach to sustainable finance 21 March 2019  I am grateful to Jennifer Nemeth for her assistance in drafting these remarks and to Ryan Barrett, Sarah Breeden, Emma Dalhuijsen, Edd Denbee, Chris Faint, Ronan Hodge and Sini Matikainen for their input. 1  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  A New Horizon? A few years ago, I spoke of the Tragedy of the Horizon – how the catastrophic impacts of climate change will be felt beyond the traditional horizons of most banks, investors and financial policymakers, imposing costs on future generations that the current one has no direct incentives to fix.1 Once climate change becomes a clear and present danger to financial stability it could already be too late to stabilise the atmosphere at two degrees. The paradox is that risks will ultimately be minimised if the transition to a low-carbon economy begins early and follows a predictable path. But for markets to anticipate and smooth the transition to a 2-degree world, they need the right information, proper risk management, and coherent, credible public policy frameworks. Today, catalysed by the COP21 Paris Agreement, and national policies such as the UK Government’s Clean Growth Strategy, some of these elements are coming into place, creating a potential path to break the Tragedy of the Horizon. But the task is large, the window of opportunity is short, and the stakes are existential.
It is equally important to avoid an inflation rate that is too low, as it is to avoid an inflation rate that is too high. BIS Review 74/2001  3  A change in interest rates is not expected to have an immediate effect on inflation. Our analyses 1 indicate that a substantial share of the effects of a change in interest rates will occur within two years. Two years is thus a reasonable time horizon for achieving the inflation target of 2½ per cent. Hence, the key rate is set with a view to achieving an inflation rate of 2½ per cent two years ahead. In some situations, where unexpected events lead to an inflation rate that is too high, it may be appropriate to apply a longer time horizon than two years. For example, reducing inflation to 2½ per cent within this time horizon may be associated with unnecessary real economic costs. A precondition for applying a longer time horizon is that there is clear evidence of strong confidence in low and stable inflation over time on the part of economic agents. Gradually, as we gain experience with setting interest rates according to an inflation target, the possibilities for placing emphasis on stability in the real economy will probably increase. Low and stable inflation is a necessary precondition for stability in the foreign exchange and financial market and the property market.

Luis M Linde: Profile of Professor Nicholas Bloom – winner of the XII Germán Bernácer Prize Opening remarks by Mr Luis M Linde, Governor of the Bank of Spain, at the XII Germán Bernácer Prize Ceremony, Madrid, 24 September 2013. *  *  *  Ladies and Gentlemen It is a great pleasure for me to introduce this award ceremony for the 12th Germán Bernácer Prize. First of all, let me once again thank the organizers and sponsors of the Prize. They have established an excellent programme to support economic research in the fields of macroeconomics, monetary policy, and financial economics. This is the 10th time that the Bernácer Prize award ceremony has taken place at the Banco de España. The continued support and backing of this initiative of the Observatory of the European Central Bank by the Banco de España is justified by its conviction of the importance of macroeconomic research, insofar as it concerns the functions to be performed by the European System of Central Banks. By recognizing the relevance of a prize like this, which has been awarded, in every instance, on the basis of academic excellence, the Banco de España reaffirms its commitment to economic research. As many of you know, this Prize commemorates a distinguished Spanish macroeconomist who worked at the Banco de España, as director of its Research Department, during the 1930s. Despite the isolation of the Spanish economics profession at that time, Germán Bernácer obtained substantial international recognition for his research contributions.
Risk measurement It will come as no surprise to you that, as a supervisor, I will begin by talking about the second of these elements, namely risks. The process of transition will entail two types of risks to the financial system:  4/9    On the one hand, the physical risks caused by the direct effects of climate change, for example as a result of the gradual increase in temperature, or more frequent or more severe climate events such as storms, flooding or natural disasters.   On the other, the transition risks. These refer to the potential effect on specific bank borrowers of the regulatory measures aimed at sustainably transforming the  economy, technological changes, and changes in customer behaviour and preferences driven by greater environmental awareness. The two types of risk are related: the more ambitious the regulations combating climate change, the greater the transition risk and the lower the physical risk, and vice versa. Environmental risk is a risk in its own right, although its impact materialises through “traditional” banking risks.

The role of supervisors – in-house initiatives As well as these initiatives, which may be considered external, we are also working in the Banco de España to adapt to this new reality. Firstly, we have created an internal function entrusted with assessing the impact we as an institution have on the environment. The aim is to articulate and coordinate the necessary measures to reduce that impact. Secondly, as a macroprudential supervisor, we clearly need to be able to assess and quantify the risks that the transition towards a more sustainable economy poses, both for individual banks and the financial sector as a whole. Among other functions, we need to be able to assess the level of financial institutions’ exposure to high-carbon emission activities, perform stress tests for the financial system overall and define scenarios and methodologies to be applied by banks individually. In consequence, we are designing internal governance structures and methodologies, actively participating in the cultural shift in the SSM supervisory model. Naturally, we are also evaluating the information and data requirements needed to address this challenge. Nor should we forget that central banks are also important investors in the debt markets, both in the area of monetary policy and reserve management. Although we have not yet included environmental risk assessment in our credit analysis, we are working to remedy this. 5  ESG - Environmental, Social and Governance.
5  All speeches are available online at www.bankofengland.co.uk/news/speeches  5  But of course innovation won’t be sustained if it’s unsafe or detrimental for financial stability. Clear, transparent regulatory expectations are critical to ensure that uncertain rules of the game don’t hold innovation back. This poses several challenges for regulators – I’m going to focus on the two that are most important for financial stability. We need payments to be secure and reliable. Problem 1 for central banks is that robust and reliable ways to pay are essential to financial stability. Well-functioning and resilient payment chains allow payments to be made on time, with confidence, even in periods of economic uncertainty. Think – receipt of your salary, benefits and pensions, direct debit bill payments ability to tap and ride the tube home or leave the restaurant after a meal. The reliability and resilience of payments is so important to our economy that the UK Financial Policy Committee, tasked with identifying, monitoring and reducing systemic risks, lists avoiding serious interruptions in the provision of payment and settlement services as one of the very purposes of preserving financial stability. If a stablecoin were to significantly replace current systemic payments chains as a way to pay – logic follows that they would pose the same risks to the economy as current payments chains and should be regulated to the same standards. This is relatively straightforward: regulation should be technology neutral: based on the activity conducted and the risks posed, not the technology used or the entity’s legal form.

So if we were magically able to bring the financial sector back to full health and an optimal leverage ratio by tomorrow, we would not have solved the problem. Significant debt problems would still exist for several sovereigns and several parts of the non-financial private sector. In addition, we would still have the confidence crisis that has been so pronounced in Europe. So it is going to be a more protracted process. The EU has not resolved its crisis, although there has been progress in deleveraging and de-risking bank balance sheets. In September 2008, when I was still at the BIS, I gave a speech in Boston bearing the title: How might the current financial crisis shape financial sector regulation and structure?1 I realise now how foolhardy that endeavour was because those were indeed early days. But still, many of the potential changes that I mentioned have stood the test of time, such as the inevitable deleveraging; shifts in bank business models, especially on the funding side; the need for bigger capital and liquidity buffers; and how potentially difficult cross-border crisis management and bank resolution would turn out to be in the European context. But there were also very important elements missing from my list – elements that have turned out to be of major importance for the unfolding of the crisis and the reform agenda.
4  See the box ”Uncertainty regarding future interest rate movements”, in Inflation Report 2006:1. 4  BIS Review 33/2006  In the second method, the uncertainty interval is instead calculated with the aid of the market’s pricing of interest rate options. The current prices of interest rate options reflect expectations of future interest rates. This method is therefore forward-looking and based on the fact that the redemption price for identical options can vary. This variation reflects the market’s assessment of the uncertainty in the future price of the asset on which the option is based. Since this variation can be observed, it is possible to construct an uncertainty interval around the implied forward rate curve. These uncertainty intervals are largely similar to the uncertainty intervals based on historical deviations (see Figure 5). To summarise, the strategy for monetary policy is being maintained with the new interest rate assumption. We normally try to attain the inflation target within a two-year period and we take the real economy into consideration. However, monetary policy cannot as before be described by the simple rule of thumb that was based on the assumption of a constant repo rate. Instead the forecasts that are based on the assumption that the repo rate will follow implied forward rates are studied and assessed. It is the whole path of inflation and the real economy that is important in monetary policy decisions.

Nevertheless, such reflection does provide an opportunity for a realistic assessment of the prospects and challenges that lie ahead for the RMB. There are at least 5 key factors. Let me list them without going into the details. •  Currencies that rise to dominance are often of countries that are dominant in global trade. •  Currencies often become internationalised because the country is a key global exporter of capital. •  Every successful currency had official support. •  Currencies can only rise to international prominence when backed by liberalised and developed markets. •  There needs to be confidence in the currency and the economy. How does China fare against these signposts? I would say that it is three out of five. As far as trade dominance is concerned, China surpassed the US economy as the largest goods trading nation in 2013. The internationalisation of the currency, despite its cautious nature, is certainly getting a lot of official support – not just from Chinese policymakers but also from policymakers in other countries. As for confidence in the currency and the economy, there would not be so much enthusiasm for RMB internationalisation were such confidence missing. The fact that countries are queuing up to be able to trade RMB within their borders, or to gain access to China’s domestic financial markets, shows a strong desire on the part of these countries to participate in what they see as an economy with a potential for continued strong growth.
Foreign investors sold Ericsson shares to a value of SEK 30 billion between September 2000 and February 2001. At the same time, the AP funds' new investment regulations and investments in the premium pension scheme have led to substantial outflows. These flows can undoubtedly have had significance in the short term, although this effect should not be exaggerated. However, the situation in Sweden is basically stable, as I pointed out earlier. There is no distrust of Sweden pressurising the exchange rate as at the beginning of the 1990s; no fundamental imbalance in our economy to arouse international concern. One measure of this is the spread between the longterm German interest rate and the corresponding Swedish interest rate, which grazed 5 percentage points during the crisis period at the beginning of the 1990s. That was how much more the pension funds in the USA and Japan wanted to receive to invest money in the unstable Sweden rather than the secure Germany. Today the interest rate margin is roughly the same and has been so since early 1999. The long-term confidence in the Swedish economy appears unshaken and the explanation for the weak krona must therefore be sought in the financial markets rather than the real economy. A floating exchange rate floats! If the krona is undervalued, shouldn't we at the Riksbank do something about it? We do have a foreign currency reserve that can be used to buy krona if necessary. However, there is good reason to approach this question with great caution.

The public debt to GDP ratio of 83% compares favorably with that of other advanced economies and competitors such as the US and Japan, respectively at 103% and 230%. EU is one of the core areas of global innovation. In terms of Research and Development expenditure it is not far behind the US, while in terms of number of researchers and patent application actually outperforms it. Europe and the EU offer a mature legal environment, with adequate protection for investors and intellectual property. Its macroeconomic policies remain stability-oriented and its financial system is both mature and sound. Five out of the ten highest ranked countries in the latest Global Competitiveness Index are EU countries. Furthermore, I would like to emphasize, apart of Eurozone, there are other countries in the Eastern and Southeastern Europe which offer a qualitatively different picture. Up to 2008 they included some of the fastest growing emerging economies. These are fast growing economies, with better demographic trends. They offer untapped growth potential, in terms of qualified work force, business friendly environment and stable institutions. European integration process has been the main anchor and major driving force of growth and convergence. Therefore, I strongly urge countries of the SEE region to dedicate substantial efforts towards a closer regional integration in infrastructure, markets, education and legal framework. Deeper economic regional integration will increase the competitiveness of the region from European and global perspective.
The challenge faced by central banks is to establish a framework that combines both price and financial stability as primary mandates and identify the policy instruments to target both, even at times they seem to conflict with each other. 2  BIS central bankers’ speeches  Central banks have typically calibrated short-term interest rates as their primary policy instrument to determine their monetary stance. Since policy rates are too blunt instruments that affect the entire economy, using them to achieve both of these targets may lead to unintended consequences. The level of interest rate required to ensure price stability can differ from an interest rate needed to preserve financial stability. For example, during boom periods driven by productivity and financial innovation shocks, a low policy rate would suffice to contain inflation; yet the very same level of interest rate may still lead to accumulation of financial risks. Moreover, during boom periods, emerging markets typically attract large capital inflows even with reasonably low level of interest rates. In such periods, the external and internal equilibrium requires different interest rates and monetary policy has to use more than one instrument. The “Tinbergen Rule” suggests that one instrument could be employed to achieve only one target, which in our case is conventionally recognized as price stability. There is clearly a need for a second set of policy tools. This second instrument, in my opinion, may be in the form of macro prudential tools that directly address financial activities.

Some countries have opted for various forms of capital control, although their effectiveness needs to be evaluated based on the objective of imposing them at the first place. Some studies find that capital controls have some compositional effect and could alter the maturity of new investments. So far as reducing the volume of flows, the empirical evidence is inconclusive. Unless the authorities have full control over capital accounts, partial restrictions are unlikely to offset the impact of flows, prevent appreciation of local currency and provide more space for independent monetary policy. In principle, flow of capital from advance economies to emerging ones and appreciation of the currencies of the latter over time is a mutually beneficial secular trend, as long as it is supported by strong fundamentals, better growth prospects, and high productivity differentials. Rather than fighting against this trend through over restrictive capital controls or excessive reserve accumulation, there is strong legitimacy in using macro-prudential policies to mitigate the adverse effects of volatility in capital flows, especially those with speculative nature, over financial stability. Several emerging economies have started implementing such measures to limit the credit growth and asset price bubbles. These measures include raising reserve requirement ratios, requiring higher income- and deposit-to-loan ratios, tightening capital adequacy requirements and liquidity ratios, introducing transaction taxes, fees etc.
Faced with such a dramatic situation, governments and central banks across the world found themselves having to swiftly implement innovative support and rescue measures on an unprecedented scale, in a bid to stabilise the global financial system and limit the economic downturn. The decisive economic policy intervention was a key contributor in calming the markets, halting the downward spiral and clearing the way for economic recovery. As a small open economy, Switzerland could not avoid being drawn into the global recession. The sharp fall in economic activity, which had begun in the second half of 2008, continued in the first half of 2009. Around the middle of the year, the trough was reached and the economy began to grow again. Over the year 2009 as a whole, GDP dropped by 1.5%, the largest decline since 1975. Nevertheless, Switzerland has so far weathered the effects of the financial crisis better than most industrialised economies. This may come as a surprise, given the importance of our financial centre. A deciding factor behind the comparative mildness of the recession in Switzerland was private consumption, which proved to be an important buttress of growth. Moreover, no major distortion was observed in the property market, and banks did not restrict access to lending. Last but not least, the rapid and decisive expansion of monetary policy also played a supporting role. Despite this positive bill of health compared to other countries, the crisis has clearly left its mark on Switzerland too.

A critical success factor for the cross-border promotion of Islamic finance is the harmonisation of the governing shariah frameworks between our jurisdictions. In this regard, Indonesia's extensive history of scholarly achievement in the subject matter relevant to the principles of Islamic finance can be leveraged upon for the benefit of the region. We are most hopeful for substantive convergence of interpretation and application of the shariah laws and guidelines for the region. The greater collaborative engagement between our respective scholars would indeed facilitate the process. Ladies and Gentlemen: The large gathering of senior representatives of the public and private sectors here today hints to the significant interest to capitalise on potential of the Nusantara economies. The efforts of the private and public sectors in building a collaborative platform as a resilient base for a network of linkages to the wider world, with God's grace, insyallah, will contribute to advancing the Nusantara Agenda that would unleash the potential of the region for a greater shared prosperity. Thank you. BIS Review 73/2007  3