samchain/econo-pairs-v1 huggingface dataset:
To assess the importance of these risks for the industry, I will now outline the latest developments in lending and private sector indebtedness. I will follow by outlining the situation of the banking industry, and will conclude with a more forward-looking analysis of its resilience and the challenges it faces in the current environment. Recent developments in lending and private sector indebtedness  After recording strong growth in 2020, in Spain bank lending to the resident private sector fell slightly in 2021. By sector, lending to non-financial corporations (NFCs) and sole proprietors declined, offsetting the more expansionary behaviour of lending to households, especially loans for house purchase. This pattern intensified in 2022 Q1, when lending overall contracted (-0.5% year-on-year) while loans for house purchase accelerated somewhat (to 1.4%). 3  Overall, thanks to the recovery in turnover and more moderate growth in debt in 2021, the financial situation of the business sector has improved, although on average it is still more vulnerable than before the pandemic. Thus, average debt and debt burden ratios fell in 2021. The percentage of highly-indebted firms1 also decreased across the board, down to almost pre-pandemic levels both in the sectors moderately affected and largely unaffected by the health crisis, although it was still 7 pp higher than in 2019 in those severely affected. In the case of households, favourable labour market and income developments are also contributing to the recovery in their economic and financial situation.

Sunil Mendis: A brief look at financial information technology Keynote address by Mr Sunil Mendis, Governor of the Central Bank of Sri Lanka, for the Financial Information Systems Seminar, Colombo, 8 September 2004. *  *  *  His Excellency Akio Suda, the Ambassador for Japan in Sri Lanka, Mr Yoshihisa Onishi, Executive Director, FISC, other officers from the FISC in Japan, Ladies and Gentlemen, The Central Bank of Sri Lanka is happy to co-sponsor this programme together with the FISC of Japan (Center for Financial Industry Information Systems), in view of the importance of financial information technology in the financial services industry. Sri Lanka is no exception to continuous changes in the technology used by its financial services industry. In a market driven financial system, for information to be effective, there should be two vital ingredients, that is system integrity and timeliness - both of which are crucial. The more dependable your information systems are, the more efficient and competitive banks can be as a player in the financial services industry. That is why we see banks investing heavily in IT. Globally too, with the interdependence of markets their integration is facilitated through information systems which link these markets which make the world a very small place indeed on a PC monitor where the whole world is virtually at your doorstep.
With this goal in sight, first we need to recognise that climate risk is a cross-cutting risk, for which risk management approaches and methodologies are largely still under-developed. Given this, there is much more to be discovered in terms of how it can be managed in an integrated manner with other financial risks. This suggests a need for an iterative process that will enable financial regulators and the industry to converge on supervisory expectations and a common framework for assessing physical and transition risks. As part of this process, we are examining the scope and specific approaches to incorporate climate-related financial risks within the Pillar 2 requirements. Secondly, the nature of climate-related risks calls for central banks and regulators to collaborate at the national level to support alignment of financial industry responses with national climate strategies and priorities. As I mentioned at the start of my remarks, central banks and financial regulators provide an important bridge between the financial sector and the Government to inform national policies, targets and strategies on the one hand, and financial sector responses to climate risk on the other hand. In Malaysia, JC3 serves as a focal point for engagements with the Malaysian Climate Change Action Council (MyCAC)1 on national climate policies. Third, effective coordination with the industry serves to maximise transition benefits and minimise downside risks. For developing and emerging economies in particular, an inclusive strategy is key to avoid macroeconomic and social dislocations as we transition to a low-carbon economy.

I trust that our product innovation will also promote the development of the bond market in Hong Kong. This creates a win-win situation for the investors, the placing banks and the Corporation. I like to thank the banking community for supporting our bond issuance. In particular, HSBC and Bank of China (Hong Kong) are underwriting a portion of the bond issue as well as placing the notes. My appreciation also goes to the other placing banks, namely, Bank of America (Asia), Bank of Communications, Bank of East Asia, Chiyu Bank, CITIC Ka Wah Bank, Dah Sing Bank, DBS Bank (Hong Kong), Hang Seng Bank, ICBC (Asia), Liu Chong Hing Bank, Nanyang Commercial Bank, Shanghai Commercial Bank, Standard Chartered Bank (Hong Kong), Wing Hang Bank and Wing Lung Bank. With your support, I am sure we will have another successful retail bond issue that is welcome by the investors. Thank you. BIS Review 81/2006  1
They thus implemented economic policies aimed at returning economic activity to levels consistent with growth potential prior to the crisis. 11 This resulted in the Great Inflation of the second half of the 1970s, the correction of which required drastic policies which led to the global recession of 1981-82. The experience of the past decade should lead to reflection with regard to the motives which led certain societies, such as the United States, to overestimate their income growth potential. One must ask in particular what are the factors which in the past 20 years resulted in the progressive misalignment between potential economic growth and the target considered to be sustainable, but which clearly was not. It was not a drastic shock as experienced in the 1970s, but a more complex phenomenon, which operated gradually. One theory, which was suggested a few years ago, is that the growth sustained by emerging economies tends to suppress the potential of advanced economies. This theory was rejected, perhaps too hastily, because it is not in line with the neoclassical theory of international trade, based on comparative advantages, which holds that when a country grows at an elevated rate, it benefits not only the country in question but also others. Higher disposable income makes it possible to increase imports from other countries, thus fostering production and growth in those countries too. The theory of mutual benefit is based on certain specific assumptions, which are not always reflected in reality.

For example, in countries where the private sector was already highly indebted, economic policies sometimes promoted further borrowing, in particular through low interest rates and fiscal incentives. If we wish to avoid recreating the conditions which led to this crisis, we must carefully examine the motives behind the economic policies that were implemented during this period. This exercise can be conducted at two levels. The first implies analysing the economic policies on the basis of the specific reference criteria of those policies. A policy may turn out to be inappropriate, for example, because it is based on incorrect economic forecasts or because it is implemented through ineffective instruments. Thus far, the discussion has mainly taken place at this level, and the remedies suggested have mainly been aimed at correcting these aspects. It is an important discussion, without a doubt, but there is a risk that such discussion is insufficient because it does not tackle the fundamental causes that led economic policy-makers to take certain measures. For this reason, a second, more profound level of analysis is necessary. Let us proceed in order. Let us begin with the first level of analysis. This involves examining the way in which the conduct of economic policies contributed to the emergence of the imbalances which caused the crisis. Various policies can be considered: structural, regulatory, fiscal and monetary policies.
The timing and severity of these enforcement steps will not be easy to gauge, and I hope that the Basle Committee’s Year 2000 efforts will provide some guidance for supervisors on the issues involved in making these choices. A key concern that I would have today about an organization is whether its senior management truly understands the scope of the Year 2000 problem and the need to tackle it as a critical management challenge and not simply as a technical issue. If appreciation of the problem is lacking at the upper levels of an organization, experience suggests that the lack of concern will filter through to the entire organization, with potentially devastating results. Testing Of the many different elements of a sound Year 2000 project plan, perhaps none is more crucial than testing. In that regard, I will now turn to some of the most important issues related to Year 2000 testing. As a first step, it is important to distinguish the different types of testing and test programs that are in place or being developed. The Joint Year 2000 Council’s recently published paper, “Testing for Year 2000 Readiness” contains a valuable discussion of these different types of tests. Internal tests are those over which the testing institution has full control and in which external parties are not directly involved. Firms that have engaged in multiple types of tests have reported that the internal future date testing phase was the most important in terms of uncovering remaining Year 2000 problems.

This environment is affecting firms in very different ways. Some companies find themselves with little need for external funds, and so are relatively insulated from tight credit conditions. Indeed, the corporate sector as a whole is currently running an unusually large cash surplus, despite challenging demand conditions. A notable example is energy extraction. UK oil companies have run a large cash surplus – amounting to 1-2% of GDP – for much of the past decade. This accounts for around half of the overall corporate cash surplus over the period. But it’s not just oil companies. The manufacturing sector as a whole is currently a net lender to the UK banking sector: it has more cash on deposit than funds borrowed. Other sectors look to have less healthy cashflow positions in aggregate – construction and real estate, hotels and restaurants amongst them. For many companies, therefore, external finance remains important. For large companies, the bond markets are an option. Some of you have switched the balance of your financing from the banking system to the bond markets. Over the past three years, the Chief Financial Officers of large companies have consistently rated bond finance more attractive than bank borrowing. Such firms seem, on the whole, to have made smaller cuts to investment and employment. Large companies with good access to the capital markets and healthy cash-flow positions may, for the moment, be well placed to support the financing of smaller firms.
However, the reverse can also apply: stock market developments also have some significance for the shaping of monetary policy. The price of  2/7  various assets, such as shares, is important in itself for the dynamics of a country’s growth and inflation trends. If, for instance, share prices rise, this stimulates household consumption and corporate investment, and vice versa. This in turn affects price trends. Thus, the stock market, like the housing market, can affect the Riksbank’s monetary policy decisions. Since the 1960s and 1970s, Swedes have been saving more and more in shares, both directly and via mutual funds and insurance, and the market has developed considerably during this period. The return on shares has been very good, seen over the past 30 years, but it has also been something of a roller coaster ride. Here I am thinking of periods of overvaluation, which have been followed by sharp price falls, for instance in connection with the financial crisis and the later IT bubble. Despite these periods of falling share prices, the percentage of shares in household wealth has increased, and stock market developments have thus become increasingly important for households’ consumption decisions and for inflation. Another reason to be interested in the stock market is its significance for efficiency and thereby for growth. An efficient securities market fulfils many important functions, for instance, as information bearer, channel for risk management and as mediator of capital.

This could in turn fuel asset prices, thereby increasing the risk to financial stability which could undermine the process of economic recovery. Indeed, some countries in the Asian region are already facing these issues and have introduced measures to reduce the risks associated with capital inflows. For Malaysia, however, it should be noted that the financial industry, the private sector and the country have the capacity to manage these challenges, given the stronger overall financial conditions in the country, low levels of corporate leverage, a sound banking system and a strong external balance of payments position. Beyond the immediate priority of establishing economic recovery and preserving macroeconomic stability, it is also acknowledged that the Malaysian economy currently stands at a pivotal juncture. In order to secure continued medium and long-term growth and development, the structure of the economy has to undergo several important changes – changes that would better position Malaysia in meeting the new challenges and reaping the opportunities that the future Asian and global landscape brings. Foremost, the events of the past two years have brought to the forefront the importance of having a more balanced and diverse model of development. Malaysia’s openness and integration with global trade and investment flows is an important source of our economic strength, and must remain so going forward. However, given the more dispersed growth prospects of the global economy in the future, it is important that the export structure of Malaysia evolves to be more diverse too.
The World Economic Forum Banking Strength index shows that the Chilean banking sector is very strong, as it ranks in the 11th place in the world. Let me finish by pointing out the relevance that the exchange rate derivatives market has had in favoring both financial stability and the conduct of the flexible inflation targeting scheme in Chile. This market is not as deep as it is in developed countries, but it has experienced significant growth of more than 10-fold since 1998, fueled in part, as I already mentioned, by the floating exchange rate regime. The role of pension funds has been significant as well, as they maintain a large positive foreign financial position, and keep hedging against exchange rate risk even above the regulatory requirements, especially in the aftermath of the last crisis. Thanks to these factors and a favorable regulation, Chile shows a high level of penetration of financial derivatives compared to other emerging economies and countries in the region. All this has contributed to a limited exchange rate mismatch of corporations. Today the share of firms with a mismatch over 10 percent of their assets is below 10 percent, down from around 20 percent before the Crisis. Hence monetary policy can be conducted in a countercyclical manner, without the need to manage the exchange rate. However, as the recent experience in developed countries has revealed, the rapid development of derivatives 5  markets also poses challenges to regulators due to their complexity and potential concentration of risks in a few entities.

And all are competing for business in a way unthought of a few years ago witness the competition between LIFFE and Eurex for the long and short ends of the euro yield curve. The latest score in that particular England:Germany match is one all. No doubt German supporters think this score-line would have been a fairer result on Saturday night, given the balance of play! 1  BIS Review 51/2000  Role of technology But the common factor in all of these developments is technology. Physical trading floors for exchanges are fast-disappearing, particularly on this side of the Atlantic, replaced by virtual floors with trading conducted electronically. And exchanges are utilising their markets and system expertise to become trading system providers as well as market operators: OM has been a leader in this field for some time now, and LIFFE has announced some exciting plans - the creation of - fittingly enough “LIFFE.com” and its recent tie-up with Cap Gemini. On balance, these developments must be in investors’ interests. They reduce costs, improve access and allow exchanges to respond quickly and effectively to users’ changing needs. But they also present a number of challenges. To move from a trading floor, with its mix of locals, brokers and market makers, to an electronic order book, undoubtedly changes the dynamics of a market. For regulators, remote trading also brings some difficult challenges. Technology does not respect national boundaries; nor does it recognise different jurisdictions.
Other changes, for example a clearer long-term orientation of fiscal policy, with an appreciable reduction of budget deficits as a major component, can also explain the more stable picture. But it does seem reasonable to conclude that the stronger focus on price stability in a number of countries, accompanied by a delegation of monetary policy to independent central banks, has helped to reduce inflation in many industrialised countries. In Sweden the average rate of inflation (UND1X) dropped from around 8 per cent in the period 1970–90 to about 1.8 per cent in 1995–2000. It is also reasonable to believe that the transition to targeting inflation contributed to the reduction of fluctuations in growth and inflation in countries such as Sweden, the United Kingdom, Canada, Finland, Australia and New Zealand. Neither can it be denied that these regime shifts may have played a part in the somewhat higher growth that was achieved in the 1990s compared with the two preceding decades. Flexible rule of action I like to think that our inflation targeting policy and rule of action are flexible, by which I mean that monetary policy is characterised by a rule of action that is simple and clear, making our actions reasonably easy to follow and foresee, at the same time as we are sufficiently flexible to alter our behaviour if this is called for by unexpected economic shocks. The important thing then is to be explicit about the motives behind our actions.

Yet despite the historically positive figures in terms of the decline in the number of unemployed (over the past 12 months, registered unemployment saw the biggest year-onyear decline ever in the related time series), joblessness remains very high, with more than  BIS central bankers’ speeches  3  4.4 million people out of work, reaffirming the need to persevere with the reforms and policies that have driven the improvements to date. It is also interesting to see that, during the fourth quarter of 2014, residential investment posted quarter-on-quarter growth of 0.4%, meaning it has increased for four consecutive quarters. These figures confirm the change in cycle and a moderately upward trajectory. In turn, open-market house prices, according to INE figures, are estimated to have increased by 0.3% in 2014, following six years of declines. The year-on-year rate in the fourth quarter was 1.8%, suggesting incipient – but growing – price rises, albeit with notable differences across regions and real estate market segments. Lastly, house-purchase figures for February announced yesterday also indicate a clear recovery, especially in second-hand housing. Underpinning the growth forecasts for our economy for 2015 and 2016 are the growth of private domestic demand and the strength of exports, along with the lower tax burden and the monetary stimulus measures adopted by the ECB, which are already having a significant impact on the cost of financing both for firms and households.
As the 2008 financial crisis highlighted, through institutions like some of the Icelandic Banks or Lehman Brothers, groups can be a source of both risk and support to UK branches and subsidiaries. Therefore, access to proportionate and timely information on the risks posed by a firm’s group is critical to the PRA’s approach to supervising international banks. Our expectations are set out in two parts. Firstly, a clear baseline of information we want on all international banks. This concerns: the nature of the firm and group’s business model; the resilience of the firm and its parent from both an operational and financial perspective; material risks to the firm’s strategy; and resolution planning. Then, on top of that, a proportionate and tailored set of data that reflects a firm’s business model, its scale and potential impact on UK financial stability. Proportionality is key here. We need more detail on a firm’s group where it is larger, more systemic and where its business model is highly integrated globally e.g. trading and custody. This is because the more highly integrated UK operations are within the group, so the more readily losses or disruption can be transmitted to the UK operations. 6  All speeches are available online at www.bankofengland.co.uk/news/speeches and @BoE_PressOffice  6  For highly-integrated businesses such as the trading activity of GSIBs, we expect access to regular profitand-loss and risk data for key trading business lines.

Jean-Pierre Roth: Ten years’ experience in steering interest rates – taking stock of the Swiss National Bank’s monetary policy strategy Summary of a speech by Mr Jean-Pierre Roth, Chairman of the Governing Board of the Swiss National Bank, at the University of Fribourg, Fribourg, 20 November 2009. The complete speech can be found in French on the Swiss National Bank’s website (www.snb.ch). *  *  *  The Swiss National Bank’s monetary policy strategy has proved successful over the ten years since its introduction. Throughout this period, the SNB fulfilled its mandate of ensuring price stability while taking into account economic developments. The inflation forecasts, produced quarterly on the basis of various indicators, have proved especially useful. It has always been possible to successfully manage the Libor – the operational objective of the SNB’s monetary policy – despite an international environment which, at times, has been extremely turbulent. The Libor was maintained within a range intended to provide the bestpossible conditions for a favourable development of the Swiss economy.