samchain/econo-pairs-v1 huggingface dataset:
Muhammad bin Ibrahim: Outstanding contributions to the development of Islamic finance in Malaysia Welcoming remarks by Mr Muhammad bin Ibrahim, Governor of the Central Bank of Malaysia (Bank Negara Malaysia), at the Royal Award for Islamic Finance Gala Dinner and Award Presentation, Kuala Lumpur, 14 November 2016. * * * Bismillahhirahmanirrahim. Mengadap Seri Paduka Baginda Yang di-Pertuan Agong Almu’tasimu Billahi Muhibbuddin Tuanku Alhaj Abdul Halim Mu’adzam Shah ibni Almarhum Sultan Badlishah, Seri Paduka Baginda Raja Permaisuri Agong Tuanku Hajah Haminah. Ampun Tuanku beribu-ribu Ampun, sembah patik mohon diampun. Patik serta seluruh dif-dif jemputan pada malam ini dengan penuh hormat dan takzimnya merafak sembah menjunjung kasih atas limpah perkenan Seri Paduka Baginda Tuanku berdua berangkat bercemar duli ke Majlis Makan Malam Anugerah Diraja Kewangan Islam Tahun 2016. Ampun Tuanku. Seterusnya patik ingin memohon perkenan Seri Paduka Baginda Tuanku untuk menyampaikan ucapan kepada para hadirin dalam Bahasa Inggeris. KeBawah Duli Yang Maha Mulia Paduka Seri Sultan Nazrin Muizzuddin Shah Ibni Almarhum Sultan Azlan Muhibbuddin Shah Al-Maghfur-lah, Sultan of Perak Darul Ridzuan, and Duli Yang Maha Mulia Raja Permaisuri Perak Tuanku Zara Salim. Your Royal Highnesses, Your Excellencies, Distinguished Guests, Ladies & Gentlemen. It is my pleasure to welcome the distinguished audience to the Gala Dinner for the Royal Award for Islamic Finance (RAIF) tonight, which is held to honor an individual for outstanding contributions to the growth and development of Islamic finance.

A high standard of professionalism, laced with strong ethical values and integrity also form the prerequisites to create a new cadre of Islamic finance scholars. The pursuit for intellectual diversity and professionalism among scholars is best demonstrated through Shariah interpretations and lines of reasoning that evolve with peculiarity of circumstances, demonstrating a high degree of tolerance and respect of other Shariah school of thoughts. It is only by having talents with these ingrained ethics and characteristics that we could elevate Islamic finance to greater heights in our endeavour to improve the wellbeing of the ummah. Tonight, as we commemorate this prestigious award, let us celebrate this year’s and past years’ winners for their contributions to drive the Islamic finance agenda forward. It is not just their academic and working credentials that merit them this award, but it is also their relentless pursuit of al-falah (success) through their drive, knowledge and wisdom. I believe that this year’s RAIF winner and past winners have paved the path for future talents of 2/3  BIS central bankers' speeches  Islamic finance to embark on breakthrough ideas and thinking. It is for this very reason, that this year’s award is conferred to the visionary talents that had made impactful and significant contributions to Islamic finance.
As a result, reserve balances fell to one of their lowest levels in a number of years apart from quarterends and were close to some private-sector estimates of where reserve scarcity might appear. Based on a wide range of indicators, and as suggested by the chart, there was no evidence of reserve scarcity on an aggregate basis; indeed, based on the metric shown, rates were little changed on this day. It seems highly likely that we are still on the “flat” part of the curve, where rates move little in response to shifts in reserves. However, it is still possible that the decline in reserves might be putting some upward pressure on rates. Even in the “flat” part, the slope of the demand curve, while small, might be nonzero. This could be true if, for example, the balance sheet costs of the marginal borrower in overnight money markets were upward-sloping with respect to that bank’s balance sheet size. I see this as a reasonable possibility, and therefore I think it might be possible that the decline in reserve balances has pushed up overnight rates a bit over time. 22 Figure 11 provides some evidence of this dynamic; as the level of reserve balances has declined, the spread between the rate of interest paid on reserves and the volume-weighted average federal funds rate has narrowed.

The expected impact of balance sheet reductions on Treasury yields and agency MBS OAS reflects the FOMC’s gradual and predictable approach to balance sheet normalization, but could also reflect additional factors. Some argue that robust credit extension by the private sector given the strong economic environment helps to offset the yield impact from a declining balance sheet. Furthermore, there are likely some spillover effects across fixed-income markets globally from asset purchase programs abroad that could affect U.S. term premia. The Balance Sheet in the Long Run For many years, the FOMC has indicated its intention that the Federal Reserve will, in the longer run, hold no more securities than necessary to implement monetary policy efficiently and effectively, and that it will hold primarily Treasury securities. 16 Also, in the June 2017 addendum to the Policy Normalization Principles and Plans, the FOMC noted that reducing the Fed’s securities holdings will result in a declining supply of reserve balances, and that it 15 In advance of each FOMC meeting, the Desk surveys primary dealers and active investment decision makers about economic and financial market topics to gain insight into their expectations. See Survey of Primary Dealers and Survey of Market Participants. 16 See the FOMC’s Policy Normalization Principles and Plans, September 16, 2014.
Indeed, the accord could smooth the punishing volatility of capital flows in and out of emerging markets as banks and investors better understand lending risks by applying the new rules. “Good risk management should also support emerging markets,” he said. Caruana said he welcomed China's announcement in August that it would delay adoption of the new accord, introducing its own rules in the meantime as its capital-weak banks struggled to modernise and reform. “It was perfectly consistent with what we were saying...a right timing and a proper sequencing was important, not to rush,” he said. *  *  *  Caruana, man of simple taste, faces complex Basel II Bank of Spain Governor Jaime Caruana is a man of simple tastes. A recent visitor to the Bank of Spain commented on the elaborate chandeliers in a conference room, a mass of coloured glass grapes. “I love those chandeliers,” the visitor said. “Personally I find them rather excessive,” Caruana replied. For a fan of the simple, it's no small irony that Caruana is driving a highly complex rewrite of global bank safety rules as the head of the Basel Committee on Banking Supervision, in one of the most dramatic and controversial financial reforms ever. In his most difficult job to date, Caruana took control of the committee at a time of unprecedented criticism for New Basel Capital Accord or Basel II, designed to replace the 1988 accord that set out how banks allot cash to buffer against surprise risks.

Prasarn Trairatvorakul: Post-crisis recovery – Asian lessons for Europe Speech by Dr Prasarn Trairatvorakul, Governor of the Bank of Thailand, at the OMFIF Golden Series Lecture, London, 12 September 2012. *  *  *  Distinguished guests, Ladies and Gentlemen, I am honored and delighted to be part of the Golden Series Lecture and would like to thank OMFIF for the kind invitation. Events such as these provide an opportunity for us to exchange views on topical issues that are at the center of international finance and I am keen to learn from the perspective of our audience. Fifteen years ago the Asian crisis forced us to go through painful adjustments and far reaching economic and financial reforms. We had to embrace legal, regulatory and governance reforms, while our business sector had to deleverage and our bankers became much more prudent and risk conscious. Today, the world is witnessing another crisis not dissimilar to ours and I have been asked to share with you some lessons from the Asian financial crisis. This is somewhat ironic as we in Asia look to Europe as a role model and a benchmark in our integration efforts. Individually we are all small states and find it difficult to compete for foreign investment without the attraction of size and economy of scale. So my talk today will be a modest contribution to the current debate on the challenge of post crisis recovery.
On data due diligence, it seems obvious to say that insurers should not enter into bulk purchase transactions without understanding in some depth the nature of the annuity liabilities they are taking on. But this is an area where we see firms taking different approaches and willing to price with different levels of risks. One particular aspect is whether insurers have a full picture of their potential obligations to pensioner spouses and dependents. Insurers need to be clear about their appetite in relation to data risks. Most of the longevity risk on new transactions is currently being reinsured, often outside of the UK. 2  Estimates of BPA market from LCP and Towers Watson market reports 2  All speeches are available online at www.bankofengland.co.uk/speeches  2  One reason is to mitigate the impact of the risk margin. As Sam Woods and I have said before, we recognise that the risk margin on long-dated insurance risks such as longevity is too sensitive to the level of interest rates and therefore too high currently. We are actively looking at further steps available to us within the constraints of Solvency II to address this issue. We expect that a more appropriate level of risk margin – similar to that envisaged when Solvency II was negotiated – would lead to a better balance between longevity risk being retained and reinsured by UK insurers on new business. While significant reinsurance continues, insurers should be paying close attention to counterparty and operational risks.

But economist David Miles makes a 5  reasonable argument that this ratio might continue to increase and I am not going to make any predictions . I will though make a couple of observations. First, simple projections suggest that equity release mortgage 6  books could face difficulties in scenarios of flat, as well as falling, nominal house prices . Second, UK experience is that although house prices do diverge across regions, they tend to move in the same direction. So insurers might not be able to diversify away the risk to any significant extent. Third, the experiences of, for example, the Japanese property market between 1990 and 2010 and the Italian property market between 2007 and 2017 show that it is possible for house prices in an advanced economy to fall over a period of decades (Chart 6). The Matching Adjustment The other major influence on insurers’ asset allocation since the introduction of Solvency II is the Matching Adjustment. The rationale for the Matching Adjustment is that annuity writers are buy-and-hold investors with locked-in funding. Provided they match the cash flows of their assets to those of their liabilities, they should rarely need to sell assets prior to maturity. They are not therefore exposed to changes in the market price of credit risk in the same way as other investors. The Matching Adjustment allows them to benefit from this advantage in two ways.
However, by maintaining price stability, the ECB almost automatically fosters the attractiveness of the euro as an international currency. Third, the international use of a currency is a complex phenomenon that does not lend itself to ad hoc promotion measures. A currency can be used not only for different functions, but also by different groups of economic agents. In this context, the use of the euro by private agents as an investment and financing currency, as well as a payment and vehicle currency, plays a prominent role. Although the euro is also used by the public sector as a nominal peg and reserve currency, the behaviour of the private sector dominates the internationalisation of the euro. The amount of financial assets managed by the private sector is many times larger than official reserve holdings. In addition, private agents usually adjust their asset management strategies more rapidly than most public sector institutions. But what are the factors behind the internationalisation of a currency? In principle, two basic factors might eventually determine the international role of the euro - size and risk. With regard to the size factor, a broad, deep and liquid euro area capital market may lead to a greater use of the euro through lower transaction costs. This may, in turn, facilitate the development of the euro as a vehicle currency for trade and commodity pricing. Already at this early stage, the introduction of the euro has brought about fundamental structural changes in euro area capital markets.

Another important task for the financial system is to reduce risks for both savers and investors. The fact that some companies can involve greater risk than others can be balanced in a well-differentiated financial market by savers spreading their savings across different forms, buying different shares, bonds, shares in mutual funds that in themselves represent a risk spread, and by depositing some in banks. A company that takes on debt in order to make profits in future through sales on foreign markets can protect itself against exchange rate fluctuations by signing futures contracts, which state when and at what prices future income will be converted to kronor. The company can also buy input goods, such as oil, and sell, for instance, pulp at a forward rate, so that the company knows for certain what its future costs and income will be. It costs to do this, but the company then faces no risks. It is quite simply a form of insurance. BIS Review 9/2002  3  When it comes to smaller companies and individual households, the securities market is hardly a suitable alternative. The risks for operators on the capital market are difficult to assess and the costs of the transactions have to be spread out over large amounts. Instead, banks and insurance companies supply services to small companies and households. The banks act as intermediaries, who receive deposits that are liquid and convert them into long-term lending, so that savers' requirements can be reconciled with the needs of the investing company.
The best, and perhaps the only, antidote to these problems is institutionalised transparency; promoting a regular, public debate on sustainable government finances at the national level. This was the Riksbank’s approach ahead of Sweden’s referendum on the euro. We recommended in this context a model that drew on the experience we have gained from conducting a monetary policy with definite, clear targets, consistent openness regarding background material such as forecasts and regular and open assessments and debates. 2  BIS Review 2/2005  Key steps in this regard could be taken by any country that wants to do so. But increased support could also be provided by way of common decisions at European level. Technically, the Excessive Deficit Protocol already contains an explicit commitment to create national institutions with a view to developing a fiscal policy framework. The EU leaders can now realise this commitment. We can also learn from each other in this process. The Commission was quick to perform benchmarking of budget systems in different countries back in the early 1990s. This was of use to Sweden when we reformed our budget process after the crisis in the early 1990s. The Commission could start up this work again. Countries could be studied, compared and put under the spotlight if they have poor fiscal policy institutions. In this way the national debates could be influenced. Allow me now to conclude with one general reflection in relation to my introductory comments.

Rapid advancement and gains to the banking sector  1.1 Overall, technological innovation has brought about the speedy processing and transmission of information, easy marketing of banking products, enhancement of customer access and awareness, wider networking and, regional and global links on an unprecedented scale. IT development has thus changed the product range, product development, service channels and type of banking services, as well as the packaging of such services, with significant efficiencies not only in the banks, but also the ancillary and feeder services to banks. The financial services industry has thus become virtually dependent on IT development. Most banks make visible efforts to keep up with new systems and processes. 1.2 The development in ICT has enabled banks to provide more diversified and convenient financial services, even without adding physical branches. The present day ATMs are more sophisticated machines that can scan the customer and a bank teller, accept cash or cheques, facilitate customer application for loans and allow for face-to-face discussion with a service representative via video. 1.3 The development of Internet services, which is an extensive, low-cost and convenient financial network, has facilitated banking services to customers, anywhere and anytime. Along with Internet and Web-based services, a need for changing core banking architecture has emerged. The introduction of new core banking systems by some banks and their links with the improved telecommunication network has enabled banking transactions to be done on-line, in contrast to the batch-processing mode used earlier.
It is true that the New Accord offers a far more sophisticated view of risk than the far simpler 1988 Accord does. But that is our intent. We seek to adopt the best measures of credit and operational risk. In the field of credit risk, for example, loan officers and risk managers in leading banks worldwide have at their disposal a constantly evolving array of databases, software, credit risk models, and risk rating systems, all of which provide supplemental empirical insight into a risk once not readily quantified. And all of these new tools were initially developed or refined to promote a bank’s competitiveness and protect it against loss - and not just to respond to a regulatory mandate. BIS Review 52/2003  3  Nonetheless, the Committee is seeking a balance between complexity and risk-sensitivity. When a complex rule fails to add much to the New Accord’s measures of risk, the Committee has worked to remove it. Most recently, for example, we announced in our Madrid press release that we will simplify the proposals for securitisation exposures. At the same time, the industry has asked that the Committee not sacrifice risk sensitivity where it makes sense. The New Accord is a complex document partly because some banks felt disadvantaged under a simpler rule and wanted rules that were more comparable to their situations. They asked us to adopt more options for addressing the risks unique to a particular business or activity which, in some cases, required some complicated considerations.

This is particularly important in the euro area – as opposed to, say, the United States – because fiscal transfers go only through the EU budget to compensate regions that lose competitiveness and become permanently depressed. The bedrock of economic union is completing the Single Market to allow for higher factor mobility. To a certain extent, the failure of markets to self-equilibrate before the crisis was because markets were incomplete. For instance, the single market in services remains unfinished, despite the fact that the areas covered by the Services Directive account for more than 45% of EU GDP. There are also significant remaining barriers to labour mobility, for example linked to the portability of pensions and national insurance contributions. However, it clear that competitiveness is a more complex issue that solely factor mobility. It depends on national traditions and economic structures. What role can the centre therefore  8  BIS central bankers’ speeches  play in ensuring competitiveness? For some fundamental issues linked to adjustment within monetary union – like flexibility of wage formation – we could envisage best practices established through guidelines for all countries set at the euro area level. But there are also dangers in over-harmonisation. We are seeing currently that system competition can play an important role in stimulating structural reform. A more nuanced way forward may be to strengthen the framework for encouraging country-specific reforms.
And following the successful symposium we held early this year, we are planning to hold a further symposium, next January at the Bank, on London as the international financial centre for the euro. 15. This exercise -- to prepare the UK markets for wholesale activity in the euro by January 1999 -- has now gathered substantial momentum. Let me touch on a few of the main priorities being pursued: 16. First, market participants agree on the need to be able to trade in London the full range of euro-denominated instruments. 17. Secondly, they also agree on the need for appropriate payments mechanisms in London to carry out transactions in euro both between parties within the UK and cross-border to and from the UK. 18. Thirdly, efficient, cost-effective mechanisms for settling transactions in euro-denominated securities also need to be made available in London. BIS Review 110/1997  -4-  19. Fourthly, there is agreement on the desirability of harmonised market conventions for the issuing and trading of euro-denominated instruments. 20. Fifthly, there is agreement on the need for as sound a legal basis as possible for euro transactions, to provide legal certainty and to ensure continuity of contract. 21. Sixthly, there are tax and accounting issues to be addressed, related to the introduction of the euro. 22. There is work going on in each of these areas, and good progress on many of them. Let me give you one example -- the payments system, which lies at the heart of the UK’s preparations for the euro.

Much of the work just mentioned was naturally initiated through the ESRB’s regular discussions on risks and vulnerabilities in the financial system. Here, the ESRB benefits immensely from its broad composition of members, as these tasks must be underpinned by a truly holistic assessment of national, sectoral and overarching aspects, including how all the individual components interact. The ECB’s support on the analytical and the statistical side is, of course, particularly important here, but also the inputs from national authorities and other bodies are essential. We have come a long way in terms of issues such as access to and comparability of data, for instance as regards national banking systems, which is a benefit not only within the ESRB membership. And products like the ESRB Risk Dashboard makes a broad set of risk indicators easily accessible for the Members as well as the general public. Furthermore, the risk discussions often generate further assessments that are eventually communicated in one form or the other, such as the reports and recommendations I just mentioned. A main strength in the ESRB’s risk assessments is, in my view, that they capture both a top-down perspective on risks as well as national assessments where the members make self-assessments of the risks at hand and what issues they expect to tackle down the road. These assessments are discussed together with all the other inputs to the risk discussions. Moving forward, one area where I hope the ESRB will make further progress is in developing the processes for making country assessments.