rules to secured lending could be some examples of measures that can effectively constrain the demand for housing credit. the macro - prudential policy tool - kit also includes instruments that target components of the financial system other than financial institutions. macro - prudential policy instruments could include measures addressing vulnerabilities stemming from financial markets – e. g. measures relating to securities markets or funding instruments such as margins and haircuts on unsecured lending. they could also comprise measures addressing market infrastructure vulnerabilities, such as encouraging a wider use of central counterparty ( ccp ) clearing houses for over - the - counter ( otc ) derivatives trading and making ccps comply with sound prudential standards. more broadly, macro - prudential policy tools could address financial imbalances directly and need to liaise with other policy areas, should the sources of those imbalances not lie within the financial system. being a new policy area, progress needs to be made on a number of fronts before the implementation of macro - prudential policy can take place in earnest, at the national or the supra - national level. a number of specific issues need special consideration in this policy field, and responses to some of the issues will indicate that our understanding of macroprudential policy is maturing. let me mention in particular the following : 1. more thinking needs to go into defining the macro - prudential policy objective itself. on the one hand, aiming at containing systemic risk might be phrased in too vague terms ; on the other hand, the specification of explicit ( quantitative ) targets might be inappropriate. some experiences in introducing prudential policy instruments in the past seem to suggest that while these were congruent with micro - prudential policy objectives, the macro - prudential dimension may be missing in their design or calibration. 2. further consideration also needs to be given to enhancing the understanding of macro - prudential policy transmission channels. the task of understanding transmission channels and assessing the potential impact of measures poses a number of challenges. for instance, it needs to take account of substitutability and competition between institution and market - based sources of credit. as such, the choice of the appropriate policy instruments may depend on country - specific factors such as the structure and features of the financial system. a better understanding of the transmission channels of macro prudential policy is critical, also on account of possible interaction with other policy areas

such business bis central bankers ’ speeches practice. we often equate moral behavior with legal behavior ; but even if an action may not be illegal, it still may not be a moral one. also, unethical business practice can trigger on the demands of the clients or stakeholders, as sometimes the push to act unethically comes from them. often clients demand forged bills of payments, overvaluation of their assets for collateral against loansfrom banks, manipulating survey of insurance claim ; window dressed balance sheets of companies to borrow from banks, etc. and, service providers are compelled to do the same, or else, financial services executives feel that adhering to ethical standards inhibits career progression at their company. however, this situation arises only when we are marred by unethical business thinking everywhere. events like this are there to change such an environment. finally, i thank the organizers for having commenced such a useful discussion. thank you very much. bis central bankers ’ speeches