cash reserve ratio requirement. let us remind ourselves that this tool is being resorted to by several central banks around the world in their own fight against inflation, often in conjunction with steep rate hikes. therefore, after careful consideration of all aspects, the bank has decided to raise the cash reserve ratio from 4 per cent to 6 per cent. i must reiterate here that any tightening of monetary policy stance is always a painful exercise for central bankers. finally, while i am on this subject of inflation, let me add that in the debate surrounding the recent discussions of our monetary policy committee and on inflation generally, it is important to distinguish between the medium and the message. i depart somewhat from marshall mcluhan ’ s message that the medium is the message. this is certainly not the case here. as chairman of the monetary policy committee, i am reminded of some other more appropriate words of mcluhan who said on one occasion “ i don ’ t necessarily agree with everything i say ”. as governor, i must stay on message with the mantra of monetary stability. let us focus the debate on the evidence, the options in dealing with inflation and the signals to be made. forget the medium. hear out the message. and yes, don ’ t shoot the messenger. with these words, i sincerely hope that this re - branding exercise will steer a new path for this new bank. i wish the new owners and the new management all the very best in their endeavour. so, as governor of the central bank of mauritius, on this most propitious day, i do now exercise two of my powers and hereby revoke the licence of the first city bank … … oh yes, of course, ….. and it is my great pleasure to inaugurate a new licence for bank one ltd. thus in the words of peter quince : “ bless thee … thou art translated! ” thank you.

malcolm edey : reflections on the financial crisis address by mr malcolm edey, assistant governor ( financial system ) of the reserve bank of australia, to the cfo summit 2014, gold coast, 16 march 2014. * * * thank you to our hosts for the opportunity to speak here today. i have called this talk “ reflections on the financial crisis ”. that might seem like a somewhat dated and backward - looking focus. after all, it is now roughly seven years since the early signs of trouble in the us sub - prime mortgage market first came to general attention, in the early part of 2007. it is 5½ years since the failure of lehman brothers brought the crisis to its most severe phase. and it is almost exactly five years since the markets and economies that were worst affected began their gradual path to recovery. five years is a long time in economics. but one of my themes today is that financial crises are costly events, and one of the reasons they are so costly is that their effects can continue long afterwards. the after - effects of the latest crisis are still with us and, i expect, will continue to shape the business environment for some time to come. it needs only a few facts and figures to convey the impact of the crisis at its height. in the world ’ s largest economy, national income and output fell by about 4 per cent over the year to june 2009. that made it by far the sharpest us recession of the post - war period. in the euro area the peak - to - trough fall in output was even larger at around 6 per cent, and in the uk it was 7 per cent. these are big numbers when you remember that in australia ’ s most recent recession, in 1991, output fell by less than 2 per cent. the contractionary effects around the world were particularly concentrated in trade and industrial production. some of the economies in the east asian region posted declines in those variables of the order of 30 per cent in the space of just a few months in late 2008. and of course financial markets were severely affected. global equity prices fell by around 40 per cent and there was a major dislocation in debt markets. on all of these counts, the recent crisis was certainly the most severe since the depression, and in that sense it might be thought of as the kind of once - in - a - lifetime event that helps to define an epoch. that background suggests a number of interesting questions that i want to think about today : • why was