samchain/econo-pairs-v1 huggingface dataset:
Andrew Gracie: CCP resolution and the ending Too Big to Fail agenda Speech by Mr Andrew Gracie, Executive Director of Resolution of the Bank of England, at the 21st Annual Risk USA Conference, New York City, 22 October 2015. *  *  *  One of the goals of global reform since the financial crisis has been ending Too Big to Fail (TBTF). This is the resolution agenda – aiming to ensure that in the event that a global systemically important financial institution (G-SIFI) fails there is minimal interruption of the activities of a firm that are critical to the functioning of the broader financial system. And achieving that outcome without recourse to taxpayer bailouts, as public authorities were forced to during the crisis. Progress in developing this new paradigm for global systemically important banks (G-SIBs) has been impressive. Key Attributes of Effective Resolution Regimes for Financial Institutions 1 were agreed by G20 leaders around this time four years ago. Statutory regimes consistent with this standard are now in place in the US, EU and Japan – in fact in all but a handful of jurisdictions where G-SIBs are headquartered. Crisis Management Groups (CMGs) have been working on resolution plans for each of the G-SIBs. The authorities participating in the CMGs have committed at a senior level in a resolvability assessment process (RAP) to the resolution strategies emerging for each of the G-SIBs. These CMGs work towards identifying barriers to making resolution work and how these should be removed.

The past few weeks have seen some calming of global financial markets, but we are still a long way away from normalisation. With the worldwide deterioration in the economy, credit risks at banks will rise considerably. Attention was drawn to this in June 2008, in our last report on financial stability. Bank provisions for credit risks are currently at a historically low level, and they will need to be substantially increased. This will have a negative impact on their profitability. In the case of the big banks, the situation also involves considerable risks for trading portfolios. The worldwide economic downturn comes at a time when the international financial system is already in bad shape. In particular the big banks that have been hit especially hard by the crisis could be forced to curtail, or further curtail, their lending. This, in turn, could have additional negative effects on the real economy. In order to put a halt to this negative spiral, we consider it important that the economy be supported with monetary and fiscal measures. The interest rate reductions carried out by the Swiss National Bank (SNB) should be seen as part of these measures. ... but the resilience of the big banks has been increased Given this situation, the fact that it has been possible to increase the resilience of the Swiss big banks is crucial. Credit Suisse boosted its capital through private investors by a total of CHF 10 billion. It thereby strengthened its equity position substantially and increased its capacity for absorbing additional shocks.
These measures are necessary to increase resilience. Banks also need to adjust to changing customer needs and to a more competitive and global environment. 10 This process of adaptation is challenging for the financial sector, but will be beneficial in the long term. The SNB also faces challenges. The current significant overvaluation of the Swiss franc implies macroeconomic costs in terms of lower growth and employment as well as negative inflation. While these costs must be set against the long-term benefits of macroeconomic stability, they engender painful adjustment processes in the economy. Our current monetary policy therefore reflects this difficult economic environment. Its two pillars, i.e. negative interest rates and foreign exchange interventions as required, serve to reduce the significant overvaluation of the Swiss franc and to guarantee price stability in the long run. To conclude, I would again like to emphasise that in order to achieve the goals of the financial sector and the SNB, we both need one another. On the one hand, the SNB acts as the bank of banks, providing a stable currency, liquidity and a payment system on which banks rely. By ensuring price stability and contributing to financial stability, the SNB helps create the conditions in which the financial sector can flourish. Banks benefit from a strong  10  6  See also Geneva Financial Center, Economic Survey 2015–2016, October 2015, which sets out the challenges Geneva, as a financial centre, is facing. BIS central bankers’ speeches  economy and long-term macroeconomic stability.

The Swiss franc remains significantly overvalued. The financial sector has also suffered from the effects of the recent crisis on Switzerland and its currency. For instance, the current account shows that exports of banking commissions have diminished markedly since the financial crisis. Indeed, the entire Swiss economy has had to adapt to new international monetary conditions. At the SNB we have geared monetary policy towards this new and difficult situation. 6  Swiss Bankers Association, Banking Barometer, September 2015. 7  BIS Triennial Central Bank Survey 2013. 8  Full-time equivalents. 9  Cf. Final report of the group of experts for the further development of the financial market strategy, dated 1.12.2014; Annex to the Review of the Swiss TBTF regime by international standards – Basis for an evaluation in accordance with Article 52 of the Banking Act, p. 55. 4  BIS central bankers’ speeches  Monetary policy during the financial and European debt crises The Swiss economy is currently being hit by external shocks. In such a context, the SNB aims to dampen short-term costs without jeopardising the long-term goals of monetary policy. The challenge for monetary policy in recent years has been to react to sudden developments in international markets and geopolitical risks that have endangered Switzerland’s real economy and price stability in the medium term. The goal has been to steer policy responses in a way that reduces short-term costs while preserving the stability achieved over the past four decades of independent monetary policy.
The international economic picture has darkened considerably and in the Inflation Report published at the end of March GDP growth was estimated at 2.4 per cent for both 2001 and 2002. This entails a reduction of a whole percentage point for the current year and half a percentage point for next year, compared with the Report published in December. The growth figures are still good in an historical comparison, but we have undoubtedly begun the slowdown that appeared desirable in December. The question now is whether the downturn will be too rapid and too severe. A good starting point When one considers this question, it is useful to observe that the Swedish economy has a pretty good starting point. A lot has happened since the crisis years of the early 1990s. Deregulation of the financial, telecommunications and electricity markets, as well as the ongoing liberalisation in trade has increased competition in the economy and forced companies to become ever more efficient. A purposeful management of the bank crisis and an equally single-minded consolidation of the central government finances have restored the international confidence in Sweden that had become rather tarnished. We have directed our policies towards price stability and thus, hopefully, left behind us a long period of price and wage spirals, followed by devaluation and where growth was lower than in our competitor countries. A credible inflation target is now seen as a necessary condition for macroeconomic stability.

More importantly, it is to avert a sharp slowdown in economic activities. Financial liberalisation Bank Negara Malaysia has also remained committed to the objectives of the Financial Sector Master Plan (FSMP) issued in 2001. The recently announced liberalization measures, for example, forms part of the concluding phase of the FSMP which is to liberalise the banking sector by allowing for the increase in operational flexibilities, product offering and, the issuance of new licenses by 2011. But, as capacity and institutional building efforts continue to be pursued, it must be complemented by enhancements in regulatory, supervisory and surveillance framework to preserve the integrity and resilience of the financial system. Clearly this is the distinction which must be made with de-regularisation per se. Islamic banking Islamic banking also remains as one of the key agendas under the FSMP. Also in the recently announced liberalisation measures, we will issue up to two new licenses given the growing demand and the need to give further boost to the MIFC initiative. As we have more than two decades of experience in this area, Bank Negara Malaysia will continue to build on this competitive advantage to ensure Malaysia remains at the forefront of global Islamic banking. It is therefore encouraging to note that Islamic finance has continued to demonstrate its evolution and strong growth as assets have expanded by 22% to RM192 billion in 2008 alone and now accounts for 15.0% of the total assets in the industry.
Christian Noyer: Foreign reserve accumulation – some systemic implications Speech by Mr Christian Noyer, Governor of the Bank of France, at the Salzburg Global Seminar, Salzburg, 1 October 2007. *  *  *  The topic of foreign exchange reserves is a very old one, but it has gained new prominence for two obvious reasons: the level of such reserves has increased dramatically over the last decade; and the management of those reserves is increasingly diversified. Today, I would like to reflect on the implications of these changes for the international monetary and financial system. I will try and examine how they are linked to the persistence of global imbalances, their consequences on global capital allocation and asset prices, as well as their impact on structural change and economic governance in all countries, both emerging and developed. The level and nature of international reserves The facts World foreign exchange reserves have surged from USD 2 trillion in 2001 to an unprecedented USD 5 trillion in early 2007. Of this total, the share of emerging Asia has risen from USD 600 bn to more than 2 trillion, as a result of reserves having increased at a rate of USD 200 to 300 bn per year since 2003. In addition, reserve assets of oil-exporters boomed in 2005 and 2006 by more than USD 200 bn each year. The drivers In order to fully understand the nature of this protracted process of foreign asset accumulation, it is important to examine the various factors motivating it.

Recently, Jeanne and Rancière 2 provided a “quantitative normative framework” to infer an optimal level for foreign exchange reserves in order to mitigate the impact of sudden stops of capital inflows. Their model, based on welfare criteria, suggests that the build-up of reserves has been excessive in Asian countries since 1997-1998. To be sure, the Asian crisis may have prompted emerging economies to reassess the magnitude of potential sudden stops and the subsequent output loss. Under widespread uncertainty, assessing an optimal level for foreign reserves confronts us with the problem of catastrophic events. In other words, even if the likelihood of a financial crisis may be very small, the potential consequences may be so dramatic that emerging countries could rationally accumulate very large reserves. 1  Dooley, M., Garber, P., and Folkerts-Landau, D. (2003) – An Essay on the Revived Bretton Woods System, NBER working paper ; (2007) – The Two Crises of international Economics, NBER working paper. 2  Jeanne, O. and Rancière, R. (2006) – The Optimal Level of International Reserves For Emerging Market Countries : Formulas and Applications, IMF working paper. 2  BIS Review 119/2007  Nonetheless, Jeanne and Rancière’s standard approach suggests that the level of reserves is in some countries excessive with respect to the self-insurance motive. Domestic monetary implications Excessive accumulation of foreign assets may lead to domestic financial imbalances. These can be caused by incomplete or ineffective sterilisation 3 .
For the younger generation, I encourage you to learn more about the tree so that you can in turn learn to cherish the freedom that you have today in memory of all our forefathers who were sold into slavery many years ago. For our senior citizens, I request that you pass on the tales of the MUKUYU TREE which have been passed on to you from one generation to another so that the spirit of the MUKUYU TREE continues to live on. Distinguished guests, Ladies and Gentlemen On our part, the Bank of Zambia Board, Management and staff are committed to the MUKUYU TREE project. We shall ensure that the process that we have started does not end here. The MUKUYU TREE is depicted on the K50,000.00 note. It has also been featured on the Bank of Zambia Christmas  2  BIS Review 1/2007  card for 2006. There are long term plans to erect a kiosk which will house an information desk for information dissemination to both local and foreign tourists. The kiosk will also sell refreshments. My request is that we all work together to protect and preserve an important part of our national heritage, the MUKUYU TREE popularly known as The Slave Tree. I thank you for joining us at this great occasion and I wish you all a Merry Christmas, and a Happy 2007. MAY GOD BLESS YOU. BIS Review 1/2007  3

But the situation for SMEs in the euro area overall is more difficult. Many are reporting a deteriorating financing situation. The availability of bank loans for SMEs across countries has become increasingly divergent. These developments reflect the fact that the economic and financial situation in the euro area remains challenging. I would like to use my address today to discuss that situation and to share with you the ECB’s views. I will focus on two themes in particular. My first theme will be the important steps being taken by governments to put the euro area on the path back to stability. Individually, they are addressing their deep-rooted economic challenges. Collectively, they are working to strengthen the foundations of the euro area. My second theme will be the measures taken by the ECB to maintain price stability and to remove unfounded fears about the euro area. These measures are essential to ensure that our low interest rates are passed through to the real economy. The current economic situation Let me begin with the current situation in the euro area. Unemployment is deplorably high. Overall economic activity is weak and it is expected to remain weak in the near term. And the growth of money and credit are subdued. In this context, inflation is well contained. We expect it to fall below 2% next year. Germany has so far been largely insulated from some of the difficulties elsewhere in the euro area. But the latest data suggest that these developments are now starting to affect the German economy.
The severe weakening of the krona when it was allowed to float also stimulated exports, which made the consolidation of public finances easier in the mid-1990s and helped the Swedish economy to climb out of the deep recession. The new framework for both monetary policy and fiscal policy and more efficient wage-bargaining rounds contributed to the rate of inflation declining and moreover fluctuating much less from year to year in relation to the 1970s and 1980s. The much calmer development of inflation was also supported by more stable inflation abroad. It is important to remember that developments with lower inflation and reduced volatility were not an isolated event in Sweden, but an international trend. From the mid1980s there was a period when the fluctuations in many industrial nations’ economies were considerably dampened in relation to earlier decades. The reasons for this development, “the Great Moderation” as it came to be called, have been the object of considerable analysis and debate. It was probably the result of a number of interacting factors. But there are many indications that the changes in the monetary policy field that took place on a broad front during this period were an important reason why inflation began to fluctuate much less.5 Inflation-targeting policy after the crisis As in the early 1990s, the most recent financial crisis has for natural reasons triggered a discussion of to what extent and in what way the current framework for monetary policy needs to be changed.

Ekholm, Karolina (2009), Some lessons for monetary policy from the financial crisis. Speech on 4 December 2009, Sveriges Riksbank. BIS central bankers’ speeches  9  Giannone, Domenico, Reichlin, Lucrezia and Lenza, Michele (2008), Explaining the great moderation: It is not the shocks, Journal of European Economic Association, 6(2–3), pp. 621–633. Jakobsson, Ulf (1997), Den svenska devalveringscykeln. (the Swedish devaluation cycle) Ekonomisk debatt, 25 (3), pp. 141–154. Jonung, Lars (1999), Med backspegeln som kompass – om stabiliseringspolitiken som läroprocess. (with hindsight as compass – stabilisation policy as a learning process) Ds 1999:9, Swedish Ministry of Finance. Reichlin, Lucrezia and Baldwin, Richard (2013), Introduction. In Reichlin and Baldwin (eds) Is Inflation Targeting Dead? Central Banking After the Crisis. CEPR/VoxEU e-book. CEPR. Summers, Peter M. (2005), What Caused The Great Moderation? Some Cross-Country Evidence. Economic Review, third quarter 2005. Federal Reserve Bank of Kansas City. Svensson, Lars E.O. (2013), The Possible Unemployment Cost of Average Inflation below a Credible Target, NBER Working Paper No. 19442, National Bureau of Economic Research. Sveriges Riksbank (2011), The Riksbank’s inquiry into the risks on the Swedish housing market. Sveriges Riksbank (2013), Financial imbalances in the monetary policy assessment. Article in Monetary Policy Report, July 2013. 10  BIS central bankers’ speeches  Figure 1. The CPIF Annual percentage change 4  4  3  3  2  2  1  1  0  0 07  09  13  11  15  Note.
From the point of view of the Eurosystem, this was a very important attribute, on top of the fact that covered bonds are akin to our traditional repurchase operations. Since the announcement in May there has been a wave of new issuances. As Spanish banks have traditionally been significant issuers of this type of securities, developments in Spain are representative. The issuance volume of Spanish banks between the time of the announcement and the end of October has reached 16 billion euro. It is now around 20% of the total euro area issuance. Spreads have declined in tandem. In Spain they are now more than 100 basis points lower than the level they reached at their peak. Liquidity has returned to the market, with tangible reductions in bid-ask spreads in secondary transactions. We interpret these developments as a confirmation that our purchase programme, although measured in size, has been effective in bringing new life to an important segment of the European financial market. Overall, we are very satisfied with the effectiveness of this programme. II. Lessons: present and future  What lessons can we draw from the financial crisis that has occupied all of us for more the last two years? The crisis has exposed the fundamental fragility of the international financial system. No segment of the market or category of players has been spared. Therefore, we have to re-consider all aspects of finance as a precondition to reform.

But when the appropriate time comes, there should be no concern about the ECB’s determination and ability to exit. As I said on behalf of the Governing Council, looking ahead, not all our liquidity measures will be needed to the same extent as in the past. Accordingly, we will make sure that the extraordinary liquidity measures taken are phased out in a timely and gradual fashion and that the liquidity provided is absorbed in order to counter effectively any threat to price stability over the medium to longer term. By so doing, we will continue to ensure a firm anchoring of medium-term inflation expectations. Such anchoring is indispensable to supporting sustainable growth and employment and contributing to financial stability. On the institutional side, the Governing Council has the unfettered capability to decide and institute appropriate policies whenever circumstances warrant. Fiscal authorities, too, need an exit strategy. Their response was instrumental in avoiding a collapse of the financial system. It helped to halt the sharp decline in economic activity and build general confidence. But that response also entailed significant fiscal costs. Only the additional fiscal burden that is associated with the workings of automatic stabilisers will reverse by design once economic conditions improve. Discretionary interventions will need discretionary action to unwind. In any case, the additional fiscal costs that governments have shouldered will be carried forward in terms of higher debt for years to come. This is why there is an increasingly pressing need for ambitious and realistic fiscal exit strategies and for fiscal consolidation.
Conference "The internationalisation of the euro and the creation of the EU Capital Markets Union" - Paris, 16 June 2023 The euro as a complementary asset in a more multilateral system  Speech by François Villeroy de Galhau, Governor of the Banque de France  Page 1 sur 6 Ladies and Gentlemen, It is a great pleasure for me to be with you today for this conference on the internationalisation of the euro and the creation of the EU Capital Markets Union. I would like to warmly thank the Robert Triffin International (RTI) association and the European League for Economic Cooperation, and more particularly Bernard Snoy, for their invitation. I will begin by discussing the monetary policy decisions taken yesterday by the Governing Council (I), before getting to the heart of the matter of today's conference. Powerful forces are pushing for greater diversification within the international monetary system (II). The euro must now play its full international role, in order to assert itself as a complementary anchor towards the "creative frontier" that a truly multilateral international monetary system (IMS) would one day represent (III). I. Monetary policy We decided yesterday a 25 basis point increase, in line with the slower pace adopted early May. And our future decisions will be data driven, meeting by meeting. Hence nobody should rush to a premature conclusion about our calendar nor about our terminal rate, and the latest market volatility seems somewhat excessive.

Thank you for your attention. 4/4  BIS central bankers' speeches