mean that individuals, households and the business community can be supported in both good and bad times. the escalation of the pandemic led to the closure of borders and the imposition of confinement measures which significantly disrupted activities in our key sectors. as a result, in 2020, the economy witnessed its worst contraction ever. the economic impact could have been more damaging without the support of the central bank. in delivering on this objective, the bank of mauritius has, since march last year, introduced its covid - 19 support programme. faced with this unparalleled situation, the bank has been very 1 / 3 bis central bankers'speeches pro - active and effective in rolling out a mix of both conventional and unconventional measures to deliver on its core mandate which includes maintaining price stability and promoting the orderly and balanced economic development of mauritius as well as preserving financial stability. some of the key measures are : the lowering of the policy rate and the cash reserve ratio in line with the accommodative monetary policy stance ; the introduction of a special relief amount through banks to allow businesses, including smes, to meet cash flow and working capital requirements ; a one - off exceptional contribution to government for economic stabilisation purpose ; the introduction of moratoriums to alleviate financial strains on individuals, households and businesses ; and a panoply of other regulatory forbearance measures. in addition, the mauritius investment corporation ltd ( mic ), which the bank set up in may last year, has been instrumental in preserving resilience in the banking sector. the mic has successfully prevented potential failures of systemically important domestic companies. this has mitigated contagion risks from the real sector to the banking sector. the mic continues to play a critical role in re - shaping the economic landscape of our country. furthermore, in delivering on its mandate, the bank has bridged the significant shortfall of foreign exchange inflows by regularly supplying foreign exchange to the market. by so doing, the bank has been able to avoid heightened economic and financial vulnerabilities that would have posed a major risk to price stability in the country. the pertinence of our strategy to preserve banking sector resilience is evidenced by the stability that we continue to experience on that front. indicators are self - explanatory. banks remain well capitalised, with a capital adequacy ratio of 18. 7 per cent, which is well above the minimum regulatory requirement. the asset quality has also remained

in addressing the deficiencies identified in the mer. technical compliance with the fatf recommendations, however, is not sufficient. mauritius must also demonstrate that its aml / cft systems and measures are effective. the fight against financial crime and aml / cft is one that requires the involvement of all stakeholders. as a means of fostering closer collaboration amongst local authorities, two new mous were signed on 19 september 2018 among the financial services commission ( fsc ), bank of mauritius and financial intelligence unit ( fiu ) on the one hand, and the fsc, fiu and independent commission against commission, on the other hand. these two tripartite mous add to the gamut of existing bilateral and multilateral mous. in terms of coordinated actions with foreign authorities, we have, as of date, signed memoranda of understanding with some 17 supervisory authorities for sharing of information and collaborative actions. the bank of mauritius has also enhanced its internal supervisory framework on aml / cft by setting up a dedicated aml / cft team. we have upgraded the aml / cft off - site monitoring supervisory toolkit through a revision of reporting requirements by banks. further, with technical assistance from the world bank, we are implementing a risk - based supervisory framework which includes a separate module for ml / ft risk. significant progress has been achieved and we expect to conduct a series of pilot run exercises shortly to test the frameworks. banks, on their part, are expected to migrate to risk - based internal audit framework to complement the risk - based supervisory framework. concurrently, the bank of mauritius is working towards implementing a central kyc registry to facilitate the kyc procedure of banks. ladies and gentlemen, you will appreciate that no matter how elaborate, effective and comprehensive our regulatory and supervisory framework is, there will always be some element of residual risk that has to be managed by banks. let me also underscore that the fight for a clean and attractive international financial centre like ours is the concern of one and all, and is an ongoing process. your input is and will remain valuable as we continue to modernize our regulatory framework. we shall continue to work towards a financial system that is as safe as possible. you will remain a privileged partner in that process as we cannot achieve anything of substance without your cooperation. we look forward to continued collaboration with all of you as usual. with this final thought, i hope that by the end of today ’ s academy, we will have