s only when the tide goes out that you learn who ’ s been swimming naked. ” 3. recent financial market turbulence a rising wave of risk aversion prompted by increasing foreclosures in the us sub - prime mortgage market resulted in an abrupt deterioration in global financial market conditions in august 2007. rising foreclosures and delinquencies were linked to sub - prime borrowers who had taken out adjustable rate mortgages. as interest rates reset to higher levels, in line with the rising us interest rate environment, these borrowers found it difficult to pay their mortgage loans. this turbulence was not confined to the us sub - prime market, spreading to the broader mortgage market and financial markets more generally. in mid - june and july, the ratings agencies cut the ratings on a number of securities backed by sub - prime loans and put on review a number of mortgage backed securities for downgrade. soon after, us foreclosures were reported to be almost 90 per cent higher than the previous years ’ level. two large hedge funds were shut down as a result of exposure to the sub - prime market. thereafter, some large sub - prime lenders collapsed, while holders of sub - prime residential mortgage backed securities also suffered losses. these events resulted in a tightening in underwriting standards, with fewer households qualifying for subprime loans. investors reassessed their tolerance for risk, most notably for structured financial products and for securities of highly leveraged firms. all of these events culminated in increasingly impaired short - term and interbank funding markets in august. many issuers of asset - backed commercial paper programs found rolling over their paper increasingly difficult. this occurred due to a lack of transparency in the financial system, with no - one quite sure of whom owns what and therefore uncertainty regarding the losses faced by financial institutions and their counterparties. investors started treating all counterparties with suspicion. the exposure to the sub - prime market became all the more pervasive, with banks and hedge funds in the us, uk, and australia, to name a few, indicating exposure to this market. the global nature of the problem was particularly highlighted when the second largest bank in the eurozone froze access to certain of its investment funds on 09 august 2007. risk aversion increased over this period, as clearly witnessed in the almost 200 basis points drop in the us three - month treasury bill yield in early august. banks began to hoard cash to cover their funding needs and as interbank liquidity dried

caroline abel : counterfeit banknote detection remarks by ms caroline abel, governor of central bank of seychelles, at the counterfeit banknote detection seminar, mahe, 7 october 2019. * * * esteemed facilitators from de la rue, seminar participants representing various stakeholder organisations, central bank colleagues, good afternoon, on behalf of the central bank of seychelles, it is a pleasure for me to welcome you to this fourday seminar on counterfeit banknote detection. i would like to take this opportunity to thank our partners from de la rue, a company having extensive knowledge and expertise on the subject matter, for joining us in this endeavour. i am equally delighted that our local stakeholders have responded positively to be part of this knowledge sharing experience. currency counterfeiting is a long - standing and global phenomenon, and seychelles has also recorded its share of reports on the circulation of forged banknotes over the years. as the sole authority that issues banknotes in seychelles, the central bank has taken steps to prevent counterfeiting and maintain public confidence in our local currency. as recently as 2016, we issued a new family of banknotes into circulation, embedded with new and improved security features. nevertheless, we are mindful that there is a need to be more vigilant and proactive, as counterfeiters are also keeping pace with new technologies for their criminal activities. it is for this reason that i commend the initiative of the banking services division, through its currency function, for putting together this multistakeholder seminar to stimulate discussion and engagement on this important subject. the issue of counterfeiting should be a matter of concern not only for us as the currency issuing agent, but also for the commercial banks, other financial institutions, as well as other partners, such as the law enforcement and regulatory authorities, and the public at large. the ability for criminals to gain access to equipment that can produce counterfeit banknotes – including the ability to replicate the security features, as well as difficulties relating to investigation of counterfeiting activities, are but some of the challenges with which we are currently faced. i am hopeful that the seminar will not only highlight the extent of the counterfeiting problem globally and in seychelles, but also create a platform for the sharing of ideas and expertise on how to tackle such challenges. while it is important to keep abreast of developments with regards to enhancing the security features of banknotes and attempts by criminals to forge currencies, it is equally