example we make use of a symmetric corridor in which depos with the central banks are conducted at the policy rate minus one percent and reserve repos are conducted at the policy rate plus one percent. when properly structured, repos are effective vehicles for the monetary policy transmission process and can be used to defend the monetary policy rate. repo markets are also a key requirement of liquid government debt markets, acting as a bridge between money and debt markets. repos conduct key functions for the efficient operation of debt markets ; including, credit risk management, funding debt portfolios playing the yield curve and covering short positions and settlement failures. repos are a versatile instrument for a broad range of market participants with very different business models due to their hybrid nature ; serving between a collateralized loan and a full transfer of ownership. 3. core structure and content these guidelines have been developed in consultation with key market stakeholders in the financial sector namely : ghana fixed income market ( gfim ), central securities depository ( csd ), with technical support from international capital markets association ( icma ) and frontclear. our guidelines are set up to enforce the global master repurchase agreement ( gmra ) and define with respect to applicable law all relevant aspects of repos traded in ghana. key changes set out in these guidelines include ; the absolute transfer of the title, rights, interest and benefits of any security used as collateral, the expansion of eligible instruments that can be used as collateral and the requirement for margin maintenance. 4. market implementation including targeted training together with frontclear the implementation of the guidelines will require training for stakeholders. the bank of ghana together with frontclear will be organizing a series of training programs starting from next week for all major players in the repo market. these training programs will cover legal requirements for the judiciary and legal fraternity, as well as accounting, settlement, margining and collateral management for middle and back office of our financial institutions. 5. market development expectations the adoption of these guidelines i believe will not only ensure legal certainty and enforceability but will also improve market transparency, liquidity and participation. in conjunction with the development of the guidelines, ghana is in the process of getting a corporate insolvency bill passed, and the bog will issue a notice to clarify the eligibility of netting arrangements under the current banks and specialized deposit taking institutions act ( bsdti act ). this will make ghana only the third netting positive jurisdiction in africa and we look forward to the positive

banking sector stability : first, banks ’ business models need to become more sustainable. in my view, banks ’ business strategy should not be directed towards increasing short - term profits by way of taking on extensive risks to the detriment of the long term viability of their business. in fact, the level of announced profit targets and their impact on peer banks has also to be seen from the perspective that higher profits mean higher risk taking and, hence, do not necessarily originate from efficiency gains alone. second, i believe that it is crucial for banks to undergo a serious reform of their corporate governance and compensation schemes. in particular, the incentives of traders, ceos and creditors of the bank should adequately reflect the risks involved so as to internalize the costs of their risk taking and potential failure. this can be achieved through appropriate compensation schemes, more transparency vis - a - vis creditors and shareholders and generally improved oversight of banks ’ business. overall, the managing board of a bank has to shift the focus away from short - term objectives towards a longer term corporate strategy. this also includes being more accountable for the risk taking of the overall business of the bank, which brings me to the next challenge. third, risk management practises need to be improved. most risk management techniques – not just used by banks but also by rating agencies – neglected the correlations of risks across securities and did not sufficiently internalize the growing systemic ( credit, market and liquidity ) risks. 3 moreover, banks underestimated tail risk. the existing risk management techniques worked well at predicting small day - to - day losses under normal circumstances but failed to predict severe losses that are very infrequent. however, it is exactly those severe losses that matter the most. therefore, banks need to devote greater attention to their risk management. this means in particular that the risk management function needs to receive a more prominent role in the organizational structure, specifically with respect to authority and independence. regulating markets and infrastructures concerning the regulation of financial markets, the crisis has clearly shown that turbulences in one segment of financial markets can create spill - overs and contagion to other segments. moreover, we have seen that both banks and other types of financial intermediaries had been seriously affected by the financial crisis. therefore, i welcome the recent agreement to establish three pan - european micro - prudential supervisory authorities – the european banking authority ( eba ), the european securities markets authority ( esma ) and the european insurance and occupational