bank has not actively sterilised its bond purchases or tff funding, it allowed its portfolio of short - term foreign exchange swaps, which were previously used for domestic liquidity management purposes, to run off. see rba ( 2020 ), statement on monetary policy, august. the story is similar for a maturing bank bond that was issued offshore in foreign currency : in this case the australian bank would have exchanged the foreign currency raised when the bond was issued for aud in the foreign exchange swap market, with the fx swap transaction unwinding when the bond matures. if the bank bond is not rolled over, the provider of aud in the fx swap will be left with those aud at bond maturity, and will need to find a new investment to place the funds into, putting downward pressure on the relevant aud interest rate. note that part of the sharp increase in assets in late 2008 was due to valuation effects on the bank's foreign reserve assets associated with the sharp depreciation of the australian dollar. the more gradual increase in the balance sheet up to 2007 reflected the fact that the australian government was running successive budget surpluses and the funds resulting from that were held as deposits at the rba. to sterilise the impact on liquidity the central bank built up its fx swap portfolio given that the government bond market was relatively small and illiquid at that time. the creation of the future fund meant that government deposits at the rba fell sharply in 2007 and the swap book was quickly unwound. the noticeable rise in the bank's balance sheet in late 2013 was due to the introduction of same - day settlement of direct entry payments, which required the rba to implement a system of overnight liquidity using open repos remunerated at the cash rate target. for further details see rba annual reports from the time, available at < https : / / www. rba. gov. au / publications / annual - reports / >, and also debelle g ( 2008 ), ‘ market operations in the past year ’, speech at the 2008 fta congress, melbourne, 31 october. the materials on this webpage are subject to copyright and their use is subject to the terms and conditions set out in the copyright and disclaimer notice. © reserve bank of australia, 2001 – 2020. all rights reserved. the reserve bank of australia acknowledges the aboriginal and torres strait islander peoples of australia as the traditional custodians of this

that this sense is more palpable in the current environment for a number of reasons that i would like to explore this morning. let me begin with the global financial crisis. while it is largely associated with a banking crisis, its implications have spread far beyond the banking sector. the insurance industry found itself in a position of having to defend its activities from being subjected to the same fate of the wide - ranging regulatory reform that has consumed the banking sector following the crisis. the loss of confidence in financial intermediaries has been particularly damaging. consumer confidence and trust in financial intermediaries have fallen to all - time lows and continuing discoveries of misconduct have done little to restore confidence. consumers are unfortunately prone to painting all intermediaries with the same broad brush and asking themselves how far they can trust their financial service providers. as a result, conduct issues are coming under significant scrutiny globally, and the expectation of professional conduct is no longer taken for granted by consumers and regulators alike. this general shake - up of the industry that followed the crisis has meant that insurance brokers, swept up in the tide, must confront the very basic ethos of their business. they must make serving the real economic interests of businesses and helping individuals secure their financial futures the heart of their business. they need to be concerned about bis central bankers ’ speeches the social and environmental impact of the business decisions that they make. and they must commit to providing a fair deal to their customers and building enduring long term relationships. the environment has become far more unforgiving of anything less. a second reason that insurance broking is at a critical crossroad is the accelerated pace of change that is occurring in asia and the business implications that this will have for the region. asia is the most dynamic and fastest growing region in the world today. the region recorded economic growth of over 7 percent in the past decade, higher than global growth of 4 percent. the imf ’ s latest forecast projects growth for asia at 6. 4 and 6. 2 percent in 2015 and 2016 respectively, in sharp contrast with anaemic growth in more advanced economies. reflecting its growing contribution to global growth, asia accounted for approximately 28 % of the world ’ s premiums, after europe ( 35 % ) and north america ( 30 % ). 1 coupled with a high population growth rate, there are projections that asia will overtake north america as the second largest contributor to world insurance premiums in several years. the establishment of the asean economic community at the