samchain/econo-pairs-v1 huggingface dataset:
By 2007, CEO compensation would have reached $ million. That is precisely in line with their actual payouts. If you believed ROE were a reliable performance metric, US bank CEOs would have had a watertight defence back in 2007. Indeed, it was the L’Oreal defence: because we’re worth it. But experience since suggests this performance was cosmetic. ROE flattered returns, and hence compensation, in the upswing. That is hardly surprising since it puts risk ahead of return and short-term ahead of long-term performance. When the downswing came, the volatility of equity returns sent many banks to the wall. Equity-based incentive contracts helped propel them there. Firm-level evidence could not be clearer. In 2006, the top 5 equity stakes of US bank CEOs ran as follows: Dick Fuld (Lehman Brothers), James Cayne (Bear Stearns), Stan O’Neal (Merrill Lynch), John Mack (Morgan Stanley) and Angelo Mozilo (Countrywide) (Fahlenbrach and Stulz (2011)). We know how these disaster movies ended. So having been divorced for almost two hundred years, ownership and control have been reunited. But they are an odd couple. Their marriage contract encourages both partners to behave in a volatile, short-term fashion. The marriage itself is destined to last less than a year. In the mid-19th century, unlimited liability was said to be deterring investors of “fortune, intelligence and respectability”. For very different reasons, today’s governance arrangements might be suffering the same fate. Banking and public policy The previous sections identified four forces which have shaped risk-taking incentives for over a century.

Bank governance would be a wealth-weighted democracy, a hybrid of the mutual and joint-stock models. This would help put risk incentives in the right place, while enhancing diversity within the financial system.16 (d) Performance and remuneration The behaviour of the financial system would be improved by an alternative set of performance metrics. The ideal metric would be less focussed on a narrow subset of the balance sheet (such as equity) and do a better job of adjusting for risk (than ROE). One metric satisfying those criteria would be return on assets (ROA). This covers the whole balance sheet and, because it is not flattered by leverage, does a better job of adjusting for risk. It would be a relatively small step for banks to switch from ROE to ROA targets in their capital planning and compensation. Yet the effects on risk-taking and remuneration could be large. Imagine if the CEOs of the seven largest US banks had in 1989 agreed to index their salaries not to ROE, but to ROA. By 2007, their compensation would not have grown tenfold. Instead it would have risen from $ million to $ million. Rather than rising to 500 times median US household income, it would have fallen to around 68 times.17 Conclusion The words “bank” and “bankrupt” have common etymological roots, dating from the 13th century. In the 13th century, it was bankers bankrupting banks. In the 21st century, bankers are still bankrupting banks. But it is no longer just banks.
The aim of this change is to make it possible for the financial companies to strengthen their capital situation by being able to have a greater proportion of financial instruments other than shares in their capital base. 6  BIS Review 7/2009  At the beginning of October, the Government decided to increase the maximum sum in the deposit guarantee scheme and to extend the scheme to cover all types of deposit in accounts. During the autumn, the Government also presented a plan to further safeguard the stability of the financial system. This plan includes a guarantee programme of a maximum of SEK 1,500 billion to support the medium-term funding of banks and mortgage institutions. It also comprises a stability fund to handle any future solvency problems in Swedish institutions. In common with several other countries, Sweden is also pursuing an expansionary fiscal policy in order to counter the downturn in economic activity. Experiences of earlier financial crises The negative consequences for the Swedish economy will be considerable over the next two years. There are two essential differences between the current financial crisis and the Swedish bank crisis at the beginning of the 1990s. Firstly, the current crisis is a global one, spread over a large number of markets, assets and institutions, while the bank crisis at the beginning of the 1990s was limited to Sweden and other Nordic countries.

It meant that during the autumn the Riksbank had cut the repo rate from 4.75 per cent to 2.00 per cent. The ECB has also cut its policy rate over the past two months to the current 2 per cent and in the United States the policy rate is close to zero. We Executive Board members were agreed that a large cut in the repo rate was necessary to dampen the rapid economic downturn that had become evident. Inflation had already begun to decline and is expected to undershoot the Riksbank’s target of 2 per cent in 2009. However, underlying inflation, which is when the effects of our own interest rate cuts and falling energy prices are excluded, will be close to 2 per cent during 2009, according to the forecasts in the Monetary Policy Update. A complicating factor is that the relationship between the repo rate and market rates has not been normal in recent months. Market rates fell less than might have been expected when the repo rate was cut in October. The spread between the repo rate and the banks’ lending rates increased. But towards the end of the year the repo rate cut had a greater impact. For instance, short-term mortgage rates have been lowered more or less as much as the repo rate up to January. But in other areas the difference between the repo rate and market rates is much greater. The financial crisis has also affected the Swedish krona.
I would first like to elaborate on the challenges we face as central bankers, then on our instruments and their effectiveness. I. Let me start with the challenges  a) As you all know, the Eurosystem’s primary objective is to maintain price stability, that is inflation rates below, but close to 2% over the medium term. However in the euro area, like in most advanced economies, inflation remains too low, despite the historically low interest rates: the harmonised index of consumer prices (HICP) indeed returned to negative territory, standing at –0.2% in February 2016, and underlying inflation, i.e. excluding energy and food, is only 0.7%. A certain number of factors are currently contributing to low inflation. Primarily, the euro area is faced with deflationary pressures associated with a series of economic shocks: firstly, the fall in oil prices, as well as the overall decline in commodity prices; secondly, the slowdown in growth in emerging economies and chiefly China; and, lastly, inadequate growth in the euro area with persistently high unemployment, which curbs wage rises and weakens demand and price growth. Moreover, structural factors, such as the ageing population, are also likely to exert downward pressure on the “natural” – or “Wicksellian” – interest rate. This rate can be defined as the interest rate consistent with the full employment of the factors of production. In this case, in order to achieve the right balance between savings and investment, markets rates must come down too.

News conference on new banknotes  Berne, 3 September 2019 Thomas Jordan  Introductory remarks by Thomas Jordan  Ladies and gentlemen I too welcome you warmly to this presentation of the new 100-franc note. The issuance of this final note brings the ninth banknote series – an important and complex project – to a close. Over the next few minutes I’d like to look back at some of our experiences, review the results and, finally, make a few observations about the future of cash. Work on the new banknote series began over 14 years ago. On 2 February 2005, the SNB published a press release announcing that it was preparing a new series inspired by the overarching theme ‘Switzerland open to the world’. In November 2005, the results of the design competition were presented to the public, and at the beginning of 2007, the SNB tasked Manuela Pfrunder with carrying out the graphic design work. This decision marked the beginning of a 10-year adventure. The development of the new banknotes was shaped by stringent quality standards on both the design and production fronts. Throughout the process, dialogue and exchange were required between all the involved parties to ensure that these standards were met. Thanks to this team effort, the ninth series – culminating in the last denomination, the 100-franc note – is now complete.
We have moved from a time where cash was king; in 2010 56% of payments were made using cash, this fell to 45% in 2015 and further declined to 17% in 2020.1 It is predicted that by 2028 just 9% of all payments will be made by cash.2 Transitioning through an era that has seen the continued decline in popularity of cheques and a rapid increase in card usage, we are now in a world where many of us today will have paid for a summer iced-coffee or groceries using our smartphones or even watches. This evolution in payments in the UK and globally is delivering transactional capability that is more reliable and quicker than ever before. But customers want more and there is a continuous drive for further improvements in speed, cost, transparency, safety and resilience. In Shakespeare’s A Midsummer Night’s Dream, some characters are transported to a new world and new, not always desirable, experiences. But this was merely temporary, and an illusion 1/6  BIS central bankers' speeches  rather than reality. Here a payments transformation is under way that could render the next decade almost unrecognisable from the transactional landscape of the past: but is a real and lasting change, bringing benefits to many. It is an environment where future generations will benefit from a new world of possibilities: one in which fast, frictionless and future proofed payments “just work” invisibly behind the scenes to unlock individual and commercial potential.

Ardian Fullani: Monetary policy, from the past to the present Speech by Mr Ardian Fullani, Governor of the Bank of Albania, at the 10th international conference on “Monetary policy, from the past to the present”, Tirana, 26 October 2012. *  *  *  H.E. Prime Minister, Your Excellencies Ambassadors, Honourable Minister of Finance, Honourable Governors, Distinguished Guests and Participants, I am very honoured and privileged to open the proceedings of the Tenth Conference of the Bank of Albania. This conference is particularly important this year as it is organised in the framework of activities for the 100th anniversary of the Declaration of Albania’s Independence and the 20th anniversary of the Bank of Albania. While retaining the scientific approach, the conference pays tribute to the endeavours made over the years in the monetary and finance aspects. In Bank of Albania’s view, the past is an essential element for the analysis and decisionmaking, and a requisite for theoretic or empirical research. At present, this is a necessity, a challenge that the economics world is facing. To scan, diagnose and cure the situation of the economy, a successful scholar would have to be able to read the human thought. Unfortunately, such a doctor does not exist. Therefore, in our days, the economic science is turning its attention to individual characteristics such as: history, ethnography and other national traits, considering them as substantial determinants for the stochastic process that leads the behaviour of economic agents.
And, in place of lending to the banks, we supplied the extra cash to the system by the direct purchases of assets. I want to stress that the banks had no choice but to accept that their collective holdings of reserves would go up. Of course, individual banks could have tried to pass the money in these accounts on to each other, but unless it was withdrawn in the form of banknotes, then it would just go round the system and end up, each day, back in an account with the Bank of England. And by paying Bank Rate on all reserves, we retained close control over market rates, even though the quantity of central bank money was swollen. Using the balance sheet to support financial stability Given that these mechanisms are used to implement monetary policy set by the MPC, then what else can a central bank do with its balance sheet to support financial stability, independently of those monetary policy decisions? That’s the question that I want to focus on in the rest of this talk. The nature of a commercial bank’s business fundamentally involves maturity transformation. Customer deposits may be available for instant withdrawal while bank lending to corporate and households tends to be committed, potentially for many years. As a result, banks typically run significant liquidity risks. The provision of a central bank reserves account helps commercial banks to manage their liquidity risk, by allowing them meet their ordinary payments needs, including normal intra-day variations.

A similar point can be made about debt issued under the Government’s Credit Guarantee Scheme – the Government provides a guarantee but it is still the market which buys the bonds and provides the cash. As these schemes come to an end, the challenge for the banks is not so much the sourcing of an additional quantity of funding. It is to roll over that existing market funding into different funding instruments. More generally, a central bank should not allow its liquidity operations to become, or even to be perceived as a source of sustained funding for banks or for any other form of mediumterm lending. The only medium-term source of commercial bank funding, and hence for their lending, is private sector savings, whether channelled through retail or wholesale markets. A central bank does not have access to those private sector savings. The grey area is that short-term liquidity support, in size and continually rolled over, looks and acts a lot like funding. That is why the Special Liquidity Scheme was designed to lend against legacy assets only and one of the reasons why the Bank has been so determined that it will end as scheduled. Suppose the scheme were to be rolled on indefinitely. What was intended and designed as system-wide central bank liquidity support would become instead a fiscal operation. We would be using government debt – and hence public money – to subsidise a group of private sector firms, with the public purse being at risk.
In this regard, to my opinion, CESEE may feel some stress impact during the process of reforms implementation which will come most likely from: –  deleveraging, in terms of lower “parent” support for liquidity and lending to local economy;  –  cross-jurisdictions similarity in economic and financial cyclicality;  –  cross-border cooperation in supervision;  –  possible capital movements and impact on exchange rate;  –  political process as, in SEE, the EU integration process is determinant;  Nevertheless, there is no option on “holding back” from the reforms for a long time, given the unstoppable process of financial integration and globalization. Hence, an early start of a pacing approach to financial regulatory reform is appropriate. BIS central bankers’ speeches  3  In the last part of my speech I would like to stop by on the impact on Albania’s financial sector and economy and possible ways to avoid/mitigate negative externalities. The features of our financial system are similar to those of other CESEEs. In fact: –  in Albania, the banking sector dominates the financial system;  –  banking activity is concentrated and controlled by foreign banks (87% of the assets);  –  in total there are 16 banks and the 4 biggest ones possess 68% of total assets. –  home countries are: Austria (1 bank), Greece (3), France (2), Italy (2), Turkey (1), Bulgaria (1).

4  BIS central bankers’ speeches  Glossary CESEE – Countries of Eastern and South-East Europe; SSM – Single Supervisory Mechanism (EU) ESRB – European Systemic Risk Board (EU) FSOC – Financial Supervision Oversight Council (USA) ECB – European Central Bank EBA – European Banking Authority FSB – Financial Stability Board PRA – Prudential Regulatory Authority (UK) FPC – Financial Policy Committee; BRRD – Banking Recovery and Resolution Directive (EU)  BIS central bankers’ speeches  5
Conclusion In conclusion, I should like to stress that when talking about the requirements of the euro area banking system, we are not concerned with ordinary co-operation across Member States, as is necessary on account of the internationalisation of financial firms' activities. We talk about a single banking sector. This means that only substantially reinforced co-operation, combined with convergence in supervisory policies and practices, can deliver the conditions for a continued integration of banking activities. This will mitigate the potential risks to financial stability that stem from the new channels of contagion and will, in turn, benefit euro area economic activity. BIS Review 91/2001  5

The Swiss Financial Market Supervisory Authority (FINMA) has called on the banks to disclose the differences between calculations using the model-based and standardised approaches. At international level, the aforementioned Basel Committee reforms will likewise result in higher requirements in terms of bank transparency. Domestically focused banks I would now like to turn to the situation of the domestically focused banks. For these banks, developments on the Swiss mortgage and residential real estate markets still represent the greatest source of risk. Over the last six months, momentum on these markets has again eased slightly overall. Growth in mortgage volumes and prices for owner-occupied residential real  BIS central bankers’ speeches  1  estate has been roughly in line with fundamentals. As a result, imbalances on the Swiss mortgage and real estate markets for owner-occupied residential property have remained unchanged since the last news conference. From a financial stability perspective, this is a welcome development. The measures taken to date to contain the risks on the Swiss mortgage and real estate markets appear to be having an effect. The countercyclical capital buffer, for instance, has contributed not only to strengthening the resilience of the Swiss banking sector, but also – together with the other measures taken, such as the revision of the self-regulation rules – to reducing momentum. However, it is still too early to sound the all-clear. For one thing, interest rates continue to be exceptionally low. For another, the residential investment property market, in contrast to the owner-occupied segment, shows no sign of cooling.
7  The average gender wage gap is a commonly used measure to summarise gender differences in career progression. In recent years, this gap has stood at 17% at the Banco de España (black bar), i.e. the average wage of male members of staff is 17% higher than that of female members. This is the raw gap and could therefore be due to differences in staff’s individual characteristics causing wage differences. The gap narrows from 17.2% to 8.4% when factoring in demographic characteristics (grey bar). Family situation lies behind a portion of this difference. The gap closes to 7.9% if we factor in marital status and parenthood (blue bar). Adding in characteristics such as years of experience and area of activity narrows the gap further to 6.8% (red bar). Taking professional group into consideration, the gap closes completely (green bar). Yet it is important to take into account that, unlike the other individual characteristics that we can assume to be exogenous, an employee’s career history has a significant bearing on their professional group. Once staff members’ individual characteristics have been factored in, a significant gap only remains for women with children. In summary, when considering the underlying causes of the gender wage gap, the two usual suspects are in play: parenthood and movements between professional groups (or promotions). In these times, marked by a sense of urgency to find solutions and answers, I believe central banks must spearhead efforts to analyse and address the major challenges facing society and the economy.

This is facilitated partly by a more adaptive and proportionate regulatory response. ... Ending in Malaysian... 1 Population of Muslims expected to grow by 70% to reach 3 billion Muslims by 2060 from current 1.8 billion  Muslims. Source: Thomson Reuters report, “The State of the Islamic Economy 2018–2019”. 2 Source: Halal Industry Development Corporation 3 Bank Negara Malaysia survey  3/3  BIS central bankers' speeches
Liquid financial markets are not the cure to the crisis, but they remain a necessary precondition to any solution. Unconventional instruments are fast becoming a natural part of the policy toolkit of major central banks. Central banks across emerging markets – including Albania – are also exploring the possibility of employing unconventional instruments. However, it is not without risks and it might not be easily implemented in emerging economies. In particular, we believe emerging markets’ central banks should avoid raising the risk profile of their balance sheets and should strive to preserve the credibility of their policy frameworks and independence. The second set of challenges is to acknowledge the long-term impact of the pandemic on our economies and societies, and to account for them in our policy frameworks. The spectrum of potential implications is wide but I will try to concentrate my remarks on a few items: The pandemic may drive a greater gap in terms of inequality, both among the advanced and developing economies as well as within an economy. An economic consequence of this pandemic is that it may slow down the catch-up process of developing economies relative to advanced ones. An additional one may be inequality within an economy, given that unemployment hits more the young population and those less educated. How these divergences may shape the future of social and economic policies aiming at addressing these divergences, this remains to be seen.

The enforced limited social interaction due to the risk from coronavirus has accelerated the shift towards digital business and digital finance. While financial technology (or FinTech) has been on the rise prior to this pandemic, the lockdown and limited social interaction has promoted further growth of this sector which may change the landscape of financial industry in the future. The pandemic may well trigger permanent shifts to the work-life balance. Remote working can become a permanent option in the future as some global companies may have already predicted. A final issue, is how the pandemic may affect the current climate crisis in the long run. Besides the short-term impact of the lockdown on the climate issue, an optimistic view holds that the lockdown may trigger e new momentum towards a cleaner economy. *** Honorable participants, I am looking forward to an open discussion and your fruitful feedback on these issues. 3/4  BIS central bankers' speeches  I am confident a frank exchange of ideas will enrich our joint understanding on the nature of challenges we are facing as well as on the best policies and instruments we should deploy to tackle them. Let me close by thanking you for being with us today! 4/4  BIS central bankers' speeches