samchain/econo-pairs-v1 huggingface dataset:
New Year wishes to the Paris financial centre – Paris, 19 January 2021  Speech by François Villeroy de Galhau, Governor of the Banque de France, Chairman of the ACPR  Press contact: Mark Deen (mark.deen@banque-france.fr) and Deborah Guedj (deborah.guedj@banque-france.fr)  Page 1 of 4  This video is a first. Our New Year’s wishes this year come in a “Covid-friendly” format: virtual but very warm. I am extending them on behalf of all the women and men of the Banque de France and the ACPR. I hope that 2021 proves to be a better year for our beloved country, with the vaccines that should halt the epidemic by the second half. A better year also for you and your loved ones, with a special thought for those of our fellow citizens who have unfortunately lost someone close to them during this epidemic. 2020 was an extremely trying year in many respects, but also a year of exceptional collective mobilisation (I). We need to capitalise on that resilience to meet the numerous challenges of 2021 (II). I. The fruits of 2020: Financing of the economy and resilience of the financial system In response to the Covid crisis, public authorities – the government and central banks – rapidly deployed a “financing bridge” to help businesses, especially VSMEs, withstand the shock and protect their employees.

For instance, in the mining sector, the supply of goods and services has been taken up by private companies including those that can be classified as SMEs. Similarly, the transport sector, which was dominated by Government through the United Bus Company of Zambia (UBZ), Zambia Railways and Zambia Airways, etc, is now largely run by the private sector, consisting mostly of small and medium entrepreneurs. One can go on to mention the tourism, manufacturing, real estate, construction and others. This development is of great benefit to the economy in general and individual entrepreneurs in particular. Therefore, small- and medium-scale enterprises have the potential to make a significant contribution to the growth of the economy, thereby improving the economic welfare of the population. As you may know, SMEs in Zambia often have a direct impact on community development. Since they are usually based in places where the owners live, they draw upon the community for their workforce and rely on it to do business. They provide employment, particularly for low-skilled workers, as well as women and the youth, who usually make up the greatest proportion of the unemployed. However, this sector has faced difficulties in accessing credit for working capital and expansion of their investments. Mr Chairman, even if more SMEs wished to modernise their plant and equipment, they would find it hard to do so because of the difficulty of obtaining financing. Many banks choose not to provide credit to SMEs as they are perceived to be more risky and yet less profitable.
Miguel Fernández Ordóñez: The Spanish experience with banking system restructuring – some lessons Opening address by Mr Miguel Fernández Ordóñez, Governor of the Bank of Spain, at the Bank of Spain Seminar – Spanish Day, ADB Annual Meetings, Madrid, 6 May 2008. *  *  *  Good morning ladies and gentlemen, I would like to welcome the participants in the Asian Development Bank Annual Meetings to the Seminar organised by Banco de España on the occasion of the Spanish Day of this year's Meetings, which conclude today. I hope that you are enjoying your stay in Madrid. I also hope that, after so many interesting meetings and discussions we will be able to provide you with new food for thought. The stakes are high, but I think that the topics selected for the two sessions of this Seminar and the distinguished panels of participants will be up to the challenge. Indeed, I am convinced that the discussions this morning will raise a number of interesting reflections. They should help us frame a better understanding of the important economic and financial challenges facing a region like Asia, which has become increasingly relevant for the world economy. Specifically, the aim of the Seminar is to reflect on how the financial system can be an instrument to rebalance and foster growth in the region. In this context, I believe that the Spanish experience on banking system restructuring – which is widely viewed as a success story – can provide some interesting lessons.

The first was the crisis in the early 1990s as Head of the Swedish Bank Support Authority, colloquially known as the “banking ER”, which was responsible for the state’s support measures to banks. Then, it was a question of guaranteeing the solvency of banks. The second was the financial crisis in 2008‒2009 when the Riksbank took action and basically guaranteed to supply the banking system with all the liquidity required to ensure it continued to work. I now have reason to say this for the second time as Governor of the Riksbank. But the crisis this time is different. To begin with, it is not a financial crisis in origin but a crisis that has arisen due to a total collapse in demand and restrictions on the supply side. This time it 4 [5]  is a question of the state bridging over in different ways so that companies can survive. The Riksbank, together with Finansinspektionen, the Swedish National Debt Office and the Ministry of Finance, has so far taken forceful measures and we have supplied large amounts in order to ensure that credit supply continues to work. The Riksbank stands ready to do more if and when necessary to help the Swedish economy get through this economic crisis as well. We may need to do even more if necessary, and do it again and again until we all see the light at the end of the tunnel. And this we are prepared to do. 5 [5]
To put it somewhat bluntly, this fallacy can be described as follows: Now that the central banks have done so much to save the economy and the financial system from collapsing, they should be permanently in charge of ensuring sound economic growth, high employment, low interest rates and a healthy real estate market. Such extremely high expectations are exceedingly dangerous. Central banks would be forced into a role in which they had to fulfil tasks for which they neither have the requisite responsibilities nor the appropriate instruments. As a result, other agents could be induced to neglect their responsibilities. While the crisis might be delayed, it most certainly would not be overcome. It may appear politically opportune to put problems on the back burner, rather than working out solutions. In the long term, however, the cost to the economy and to society would be horrendous. What can central banks do to counter such unrealistic expectations? They can, for instance, communicate clearly and emphatically what their role is and where their limits are. With this in mind, I invite you to join me on a brief tour d’horizon. I would like to start by examining a few selected aspects of monetary policy, focusing on long-term effects. I will then look at the area of financial stability. Finally, I would like to use the insights gained in this brief overview to answer the question posed in the title of this presentation about the role of central banks.

Yet the concerns which used to be expressed about preventive approaches are not entirely without foundation. It is not usually possible for central banks to fully measure the build-up of excesses on financial and asset markets in real time, to intervene at exactly the right time and thus put a stop to dangerous bubble formations at precisely the right moment. However, the current macroprudential toolkit neither claims nor intends to do this. Just as monetary policy is unsuited to fine-tuning the economy, macroprudential measures are also little suited  6  BIS central bankers’ speeches  to fine-tuning asset and credit markets. Instead, what is involved are relatively limited interventions in order to prevent foreseeable larger imbalances that might possibly endanger financial stability at a later stage. While there is broad international consensus that the new instruments make sense, there is a wide difference of opinion about how the institutions that use them should be organised. In some cases, new bodies have been created to examine the use of these instruments, while in other cases responsibility has been placed fully in the hands of the central bank. A number of countries have gone even further by handing over the traditional area of individual banking supervision to central banks as well. Similarly, it is equally impossible to use a one-size-fitsall approach for all the measures and instruments introduced in different countries.
Payment of interest on reserves allows us to control short-term rates with even a large amount of excess reserves outstanding. In addition, we can drain excess reserves in several ways. We have developed term deposit accounts and the ability to conduct reverse repurchase operations with a large number of counterparties that would allow us to drain a large volume of reserves. Also, when the time is right, the Fed can always sell assets. Such asset sales would lead to a rise in longer-term rates and this would have a contractionary effect on the demand for credit. I am very mindful of concerns here and abroad that balance sheet expansion could be interpreted as a policy of monetizing the federal debt. However, I regard this view to be fundamentally mistaken. It misses the point of what would be motivating the Federal Reserve. The FOMC would only engage in large-scale asset purchases in order to push the economy more rapidly toward the dual mandate goals of full employment and price stability. Once these goals were accomplished, there would be no basis for further purchases regardless of the government’s fiscal position because additional purchases would not be consistent with this mandate. The second constraint is that further balance sheet expansion would increase the Federal Reserve’s interest rate risk by raising the maturity mismatch between its assets and liabilities. Recall that the bulk of the Fed’s liabilities are overnight reserves and the bulk of its assets are longer-term Treasuries, agency and agency MBS securities.

Second, even if the central bank does recognize the emerging bubble and wants to prevent it from building up, by the time it could form a judgement about this, it would be to late. Third, if a central bank is fortunate with both the recognition and the timing, there is still a risk that it will cause an economic recession. To have any effect on excessive optimism about future returns on financial assets, the monetary response might have to be. Nevertheless, the costs of financial cycles are sufficiently large to warrant an exploration of several avenues for mitigating them and this should, to my mind, not exclude the possibility of monetary policy actions. I’m not saying that a central bank should target asset prices per se. Stock prices and real estate prices rise and fall for many reasons. In my view, however, a central bank needs to be observant when notable increases in asset prices are one of several imbalances that are building up even if inflation in goods and services does not show any sign of rising. Such imbalances could be a combination of strong credit growth, rapidly rising investment and a marked deterioration in the private sector’s financial balance. I do not mean to imply that determining when such a situation is on the way is particular easy. My point is that monetary policy should not be excluded a priori in a scenario like this. There are many other difficult assessments that central banks have to make.
Islamic finance practitioners in principle, are at a minimum, duty-bound to observe the norms of high ethical conduct to uphold the values and the sanctity of Shariah. Principles alone however, do not insulate Islamic finance from experiencing conduct risks. Examples in the past from various cases of frauds, breach of trust and mismanagement have occurred, exposing Islamic finance to reputational risks. Operational safeguards remain critical in the day-to-day decision making and business operations. Islamic finance must also continuously reflect on whether the governance arrangements, practices and business models of their institutions are effective and impactful. Islamic finance can lead in financial inclusion and governance Today, Islamic finance has already established itself and garnered significance in many parts of the world. Though much of this appeared as a natural outgrowth of growing prosperity in many Muslim countries, it did require governmental support and regulatory pushes. In Malaysia, where the modern form of Islamic finance has developed for over 40 years, the national strategy to develop Islamic banking and finance was driven from two perspectives, as an initial strategy for financial inclusion and to later on position the country as a leader in Islamic finance. In financial inclusion, Islamic finance played an important role in bringing those who exclude themselves from the conventional system on religious grounds. Demographically, Muslim households make up the majority in our country, including that of the B40 income category. There is a natural affinity to subscribe to Islamic finance. Nevertheless, outreach beyond the urban areas always requires additional effort.

Adnan Zaylani Mohamad Zahid: Leadership, values, ethics and Islamic finance - the next generation of Islamic financial institutions Keynote address by Mr Adnan Zaylani Mohamad Zahid, Assistant Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the IFN Asia Forum 2019, Kuala Lumpur, 23 April 2019. * * * Allow me to first begin by thanking the organiser for inviting me to deliver the keynote address at this annual IFN Asia Forum. It is a pleasure to be here this morning in the company of such a diverse gathering of Islamic finance professionals and weigh in on an important subject of which the organiser had kindly assigned me; “Leadership, Values, Ethics and Islamic Finance: The Next Generation of Islamic Financial Institutions". For many of us, the 2008 global financial crisis will be one of the major events that stays with us throughout our careers. In Asia, we had the Asian Financial Crisis in 1998 which was momentous but given the scale and its far reaching impact, the 2008 crisis has left far larger imprints. More than a decade has passed, yet we continue to live under its shadows. A world that has grown at a slower pace, in a low inflation, bordering on deflationary risk environment for the better part of a decade. Banking and financial regulations that undoubtedly have strengthened the resilience of the system, but could have had unintended consequences on growth.
Our stock exchange for blue-chips is located in London, our future exchange is associated with the German exchange. While technical and professional know-how are important, integrity, reputation and trustworthiness are more and more of the essence. Swiss banking secrecy has sometimes proved a source of misunderstanding and even tension in our relations with our partners. The objective of our bank secrecy is to protect the private sphere and to enhance the depositors’ confidence in the banking system. It does not aim at encouraging tax evasion or protecting funds of dubious origin. As I mentioned earlier on, an agreement on the taxation of savings has recently been negotiated with the EU. EU deposits with Swiss banks will be subject to a withholding tax whose proceeds will be transferred to the country of origin of the funds. Within this new tax regime no harmful tax competition between Switzerland and the EU will take place despite the presence of bank secrecy. BIS Review 27/2003  3  The importance we give to the integrity of our banking system can also be highlighted by our efforts made to combat money laundering and terrorist financing. Switzerland has done much in this area to protect its good name as a financial centre. Six years ago it placed its commitment to the fight against money laundering on a statutory footing. Our anti-money laundering laws serve today as reference for many countries. Let me move on to the National Bank’s monetary policy and the significance of the euro. 5.

Figure 7 A time-varying capital requirement Tier 1 Capital  Countercyclical capital requirements  M inimum requirements  Upturn  10  Downturn  time  BIS Review 68/2010  When economic activity is strong, the capital requirement is high, and vice versa. This timevarying capital requirement has two functions. The first is to build up the bank’s capital buffer when times are good and then let this buffer decrease during less favourable periods. The second function is to dampen credit growth when times are good by increasing the capital requirement and thereby the bank’s lending costs. This increase in the bank’s lending costs in turn implies an increase in the interest rate margin – and thus the lending rate. In light of the discussion of “just the right level of regulation”, a time-varying capital requirement and other regulations varying across time may have certain advantages. Their more apparent connection with risk build-up may make them less costly than the alternative of introducing a constant higher “minimum requirement”. One objective of varying regulations across time is to affect credit growth through the interest rate margin. This creates an additional source of variation in the interest rate margin, which can be illustrated in the lending rate equation by adding an additional time index for the regulations:  itlending  it   t ( zt ) . An interest rate margin with time-varying regulations also implies another dynamic for the transmission mechanism and is more complicated than a one-off shift.
Ajith Nivard Cabraal: Sri Lanka and its battle against money laundering and terrorist financing activities Keynote address by Mr Ajith Nivard Cabraal, Governor of the Central Bank of Sri Lanka, at the Commonwealth Secretariat Programme on Financial Investigations Training, Colombo, 22-26 January 2007. *  *  *  Your Excellencies, Ladies & Gentlemen, It is a great pleasure that I welcome you to the inaugural ceremony of this conference and extend to all overseas participants and representatives a very warm welcome to our country. I am also very happy to be able to share a few thoughts with you at this Forum about the progress Sri Lanka has made in its battle against Money Laundering and Terrorist Financing activities. Sri Lanka has given serious recognition to the need for preventing money laundering and combating the financing of terrorism in view of their adverse consequences both economic and social. In fact, Sri Lanka has been a victim of terrorist financing and suffered immensely by its consequences. As we all know, money laundering and financing of terrorism promote criminal activities, endanger financial system stability and misallocate resources into non-productive investments. The Central Bank of Sri Lanka has a special concern about these adverse consequences, as it has a mandate to maintain financial system stability together with economic and price stability.

We urge you to discuss the many issues confronting our respective countries and attempt to learn from each other as well as from the broader experiences from international experts and develop our skills and expertise. We also look forward to your report at the conclusion of your deliberations. Let us also offer all of you our continued co-operation in your collective endeavors to combat money laundering and terrorist financing activities. Finally, we wish you a successful learning experience and hope that your efforts will effectively contribute to the prevention and suppression of money laundering and financing of terrorism. BIS Review 9/2007  3
The behaviour of prices in the euro area is also a cause for concern. Against a fragile macroeconomic background, as at present, very low inflation rates entail a danger that consumer and business expectations will stand excessively below the ECB’s medium- term price stability objective of 2% for the euro area as a whole. Contrary to the downside risks surrounding the growth projections for the international economy as a whole, those for inflation are more mixed and have given rise to different responses by various central banks. The US Federal Reserve and the Bank of England have begun to withdraw some of the exceptionally expansionary non-conventional measures they introduced at the height of the crisis. Conversely, the European Central Bank has gone in the opposite direction, deepening the expansionary stance of its monetary policy. The euro area monetary policy stance has taken the form of a series of measures adopted, in the main, at the June and September meetings of the ECB Governing Council, where conventional action has been combined with other exceptional and non-conventional measures. Among the conventional measures, official interest rates have once again been cut. The main refinancing operations rate currently stands at an all-time historical and technical low of 0.05%. The deposit facility rate moved into negative territory in June and was further lowered in September to –0.20%, thus increasing the cost for banks of holding immobilised surplus liquid balances in their accounts with the Eurosystem.

To August, the central government, Social Security and regional government budget outturn evidenced a deficit of 4.3% of GDP, a 0.3 pp improvement on the same period the previous year. To meet the deficit target requires an improvement of 0.8 pp of GDP over the year as a whole; accordingly, the increase in revenue and/or the containment of spending in the final four months of the year will need to be greater than that recorded between January and August. This greater effort should be concentrated at the regional government level where, on the information available, the risks of slippage are located. For 2015, the Budgetary Plan sets a budget deficit target of 4.2% of GDP, 1.3 pp of GDP below that for 2014. In terms of the different agents, the reduction in net borrowing would amount to 1 pp of GDP in the case of central government and the Social Security system, while the regional governments should adjust their fiscal imbalance by 0.3 pp of GDP and local governments should run a balanced budget. In 2015, the improvement in the cyclical position and the reduction in government debt yields will contribute to enhancing public finances. On the estimates available, meeting the deficit target for the coming year will require a budgetary adjustment drive, measured by the change in the primary structural balance, that is appreciably less than that made in previous years. Overall, what we have is a more favourable macroeconomic scenario for the adjustment than that in place in 2012 and 2013.