b mahapatra : implications of new bank licences inaugural address by mr b mahapatra, executive director of the reserve bank of india, at the post graduate students ’ conclave on “ implications of new bank licences ”, at the national institute of bank management, pune, 28 september 2013. * * * the assistance provided by shri s. s. barik, general manager, rbi, is gratefully acknowledged. 1. i have great pleasure and privilege in associating myself with the conclave of the post graduate students of national institute of bank management ( nibm ), pune. i am indeed grateful to director allen c a pereira for inviting me to deliver the inaugural address. nibm is a premier educational institution of the country in the field of banking and finance and it is but natural for them to select a subject of topical interest for this conclave. 2. i understand that the objective of this conclave is to explore the implications of new bank licences on the banking sector, and that, some of the eminent bankers and ceos of nbfis, who have interest on the subject are also present to express their views, besides the students of the institute. i am sure the conclave will generate a lot of heat and throw much light during its deliberations. i congratulate director pereira and his team for this. the broad picture 3. before i proceed with the subject, let me first present as a backdrop, a broad picture of today ’ s indian banking and financial system : indian financial system is bank dominated – banks ’ share at 63 per cent of total assets of the financial system, is followed by insurance companies at 19 per cent, non - banking financial institutions at 8 per cent, mutual funds at 6 per cent and provident and pension funds at 4 per cent, of the total assets of the financial system. even among the commercial banks, public sector banks have dominant number of branches at about 67, 000, followed by private sector banks at about 13, 500 and foreign banks at about 325 branches, constituting 83 per cent, 16. 6 per cent and 0. 4 per cent respectively of the total number of over 100, 000 branches of banks. licensing of new banks – a historical perspective 4. historically, commercial banks in india were privately held. however, postindependence, from 1951, the government of india adopted planned economic development for the country through five year plans. the economic planning envisaged state ownership of the

luigi federico signorini : macroprudential policy - effectiveness, interactions and spillovers welcome address by mr luigi federico signorini, deputy governor of the bank of italy, at the fourth annual macroprudential policy group research workshop, rome, 10 october 2019. * * * it is my pleasure to welcome you to the fourth macroprudential policy group research workshop. we are honoured to host an event that has become one of the most important opportunities to discuss macroprudential policy in europe. i would like to thank the organisers, the keynote speaker, the contributors to the four sessions and the panellists for the roundtable that will conclude the conference this afternoon. the papers to be presented today cover a wide array of topics and will help us to understand crucial features of the transmission mechanism of macroprudential policies. they take stock of the experience accumulated in recent years across the euro area. they also strive to contribute to the development of a measure of the prudential stance, an endeavour that i have always advocated as essential for the conduct of macroprudential policy. let me spend a few words on this point. the concept of stance should convey information on the overall impact of the policy instruments that have been implemented, on their adequacy in meeting policy objectives given the identified risks, and on the required policy orientation. a credible stance would help to enhance policy communication, reinforce transmission channels and counter potential inaction biases. certain steps towards setting a framework for a macroprudential stance in the eu have been taken. a notable contribution is a recent european systemic risk board publication, which proposes a “ risk - resilience ” framework to define the macroprudential stance. in that framework, the amount of systemic risk faced by the financial sector is compared to the level of resilience against negative shocks stemming from microprudential provisions, regulatory aspects or public safety nets, and the additional resilience created by the active macroprudential tools. the macroprudential stance is defined as loose or tight depending on whether the difference between risk and resilience is above or below some pre - specified level that measures the risk tolerance of the authorities, and thus, the “ neutral ” policy stance. this is an interesting framework and i certainly welcome it as a good starting point for a policy discussion. it is a high - level framework, however, and certain concepts need further development. without any claim to being exhaustive, i