, the spate of product innovation with complex risk phenomena, the contagion effects that a crisis can spread given the linkages and interdependence of financial institutions, and the growing bis central bankers ’ speeches trend of businesses without borders, all call for a new approach to ensuring the financial health of our economies. and that, ladies and gentlemen, is what risk - focused supervision is all about. role of the supervisor in risk focused supervision the role of the supervisor in modern financial system supervision is to ensure that the risk management systems in place and the capital held, are appropriate for the variety of identifiable risks to which supervised financial institutions expose themselves on a day - to - day basis. the supervisor must have the authority and expertise to review and intervene in risk management processes, where necessary. this involves monitoring and evaluation of the risk profiles of supervised institutions in relation to their business strategies and risks. regulators and supervisors must fully understand any new financial innovations, instruments and market practices in order to have the expertise to develop models, assumptions and views of financial institutions, and certify the risk management of those supervised institutions. of course, the effectiveness of any risk - based approach owes a lot to the supervisor ’ s ability for early identification and monitoring of new and emerging risks. supervisors can devote a lot of time and effort toward trying to prevent or mitigate a risk incident but, as we have been taught, a good supervisor should target patterns of behaviour that give rise to excessive risktaking in the first place. when it comes to supervising for risk, behaviours matter. things like : • corporate governance • risk appetite ; • risk management ; • alignment of incentives to risk taking ; and • organisational culture ; are all important. institutions that have, and effectively implement these things, are likely to be well - run and would portray a good grasp of their risk environment. institutions that merely have them and do not effectively take action in ensuring that these are implemented, are inviting trouble. ladies and gentlemen, getting to grips with matters of risk management requires a more proactive approach from supervisors. • it takes a deep understanding of an institution ’ s operations and appetite for risk for its significant activities ; • it takes frequent interaction with regulated institutions at both board and management levels ; • it takes a capacity to assess the effectiveness of risk management and control functions, ( including how the institution is governed and the prevailing risk culture ) ; and, • it takes a capacity and willingness to act when inadequacies are

it can, with great assistance bis central bankers ’ speeches from locals and our foreign friends alike. the assistance coming through is unprecedented and the resilience of our people is without question, but we must continue to all work together to quickly rebuild our nation. official launch ladies and gentlemen, i reiterate that it is a pleasure to be with you this evening to celebrate with merchant finance limited. i congratulate the board, management and staff on this evening ’ s event. without further ado, i have much pleasure in officially launching the company ’ s new name “ merchant finance limited ” and its four new trade finance products : • trade finance local ; • trade finance import ; • trade finance export ; and • agri trade finance. i wish merchant finance limited every success for the future. vinaka vakalevu and have an enjoyable evening. bis central bankers ’ speeches