association ( uba ) had a general meeting today and agreed to re - elect most if not all their current executives. i am pleased to announce that mr. samwiri njuki, md orient bank has been re - elected as chairman uba and mr. nick mbuvi, md barclays has been re - elected vice chairman of uba. congratulations. let me conclude by once again thanking you for being here this evening. may god bless you all.

because managing risk is essential for a rational allocation of capital among competing investment projects, which is essential for economic growth. although the strategic objectives of management in the public sector are often different from those in the private sector, effective risk management is essential in both sectors. the timing of the workshop is especially opportune, coming in the wake of the most severe global financial crisis in more than 50 years. the global financial crisis has provided salutary lessons for risk managers in financial institutions all over the world. risk managers have begun to understand that financial risk is a much more complex phenomenon than had hitherto been realized, prior to the crisis, not least because risk can be generated endogenously within the financial system, rather than being simply the consequence of exogenous shocks to the financial system. the global financial crisis has demonstrated that even those assets and financial institutions regarded as relatively risk free – investment grade securities for example – can suffer substantial losses. we now know that tail risks, the low probability risk of very large losses – sometimes referred to as “ black swans ” – occur much more often than is predicted by many statistical models. risk managers have also learned that the liquidity of financial assets and institutions is much more fragile than they had previously thought, especially in transactions based financial systems, and that a drying up of liquidity can generate large losses in asset values. the value of rating agencies and the ratings that they provide have also become the subject of critical review as a result of their performance in the run up to the global financial crisis. reputable rating agencies issued panglossian ratings for securities, such as collaterised debt obligations, the risks of which they did not properly understand. investors who purchased these securities in the belief that they carried negligible risk suffered serious losses. looking ahead, it is difficult to be sanguine about the prospects for stability in global financial markets. the large structural imbalances which characterize the global economy will eventually have to be rectified ; a process which could generate further volatility in asset prices, such as the exchange rates of the major international currencies. the global economic crisis itself has severely damaged public finances in many of the industrialized economies and this is bound to have consequences for the price of government debt and possibly also exchange rates in the medium to long term. as a result, the type of assets which traditionally comprise the bulk of central bank foreign exchange reserves may become much more volatile in the future. in such circumstances