Datasets:

samchain

/

BIS_Speeches_97_23

like 0

Ladies and gentlemen, what is incumbent among financial supervisors in order to facilitate and strengthen financial stability at this time, is to create and maintain an information sharing structure that will allow all to react swiftly and preemptively to changes in the operating environment. This will certainly help prevent the occurrence of a crisis of the magnitude and breadth we’re seeing today. II.

Conduct of business supervision Let me now move on to my second message which, I believe is an issue that is of particular interest to developing countries. One characteristic of developing countries is the relatively weaker financial sophistication of their consumers, which makes the customers quite vulnerable to financial scams, including relatively simple ones.

That said, the budget figures for the fiscal year just ended were little affected by the fiscal policy response to the recent hurricanes. Only a small portion of the emergency federal outlays budgeted for hurricane relief were actually spent in September, the last month of the fiscal year.

In the past, we have considered several important framework questions, most notably: whether to lower or raise the inflation target; whether to adopt a price-level path target, instead of an inflation target; and what would be the implications for monetary policy of financial stability vulnerabilities and risks.

However, there were vast variations in the method and more importantly the risk sensitiveness of capital regulations across countries, rendering comparability difficult. Basel rules are an internationally accepted regulatory framework providing minimum standards to be met by banks. Since 1988, the Basel framework has evolved responding to various developments.

While the concept of regulatory capital that is aligned to risks in the balance sheet of a bank was enunciated through the capital to risk weighted assets ratio (CRAR) under Basel I, the Basel II framework, introduced Page 9 of 19 in 2004, brought about better determination of risks by introducing greater granulation of risks of various categories of assets of a bank.

What may be in play, therefore, are the transition costs of a rapid increase in globalization, and especially transition costs associated with entry of emerging market economies into the global economy. A third theme in my interpretation of the Asian crises is perhaps a lesser focus in Hy’s work, but he was nevertheless quite prophetic in relation to the recent crises.

Hy warned that the ability of a central bank to act as a lender of last resort is limited to debts denominated in the country’s own currency.3 When countries finance their domestic projects with foreign denominated debt, therefore, they lose the stabilizing potential of their central bank’s lender of last resort power and confront a far more challenging and potentially unstable environment.

And I am not going to pass them on. But, speaking generally, without mentioning individual banks or figures, how good are the German banks? I’m not going to tell you that either. You can ask me as many times as you like.

Data analysis planned by the IAIS has been interrupted. The Fed would like to see the monitoring period extended by a year or longer given the unforeseen and unavoidable delays of the last year. This would allow for completing the originally intended analysis and incorporating any needed design changes.

As I will describe shortly, recovery of overseas economies – especially the U.S. economy, which is getting over the effects of the unusually severe winter weather and has started to return to a recovery trend – is expected to act as a tailwind for Japan’s economy.

In the meantime, the core CPI for fiscal 2013, which was revised upward from the median of the Policy Board members’ forecasts in the January 2014 interim assessment of the Outlook Report, registered 0.8 percent on a year-on-year basis. The fundamental reason behind this upward revision to prices despite the downward revision to the GDP growth rate will be explained later.

As of yesterday, reserves held with the Reserve Bank were above $ billion, a historical high and sufficient to cover 5.2 months of retained imports of goods and non-factor services. Ladies and gentleman, the numbers are coming together for us and I have not seen them this good for a long time.

The Government has played its part in recent years and continues to do so, but we are also now seeing the Private sector, the often quoted “engine” of growth, stepping up to the plate in a serious way.

That all these institutions survive to date is a tribute to M Ct’s enduring legacy. 4. M Ct was quite the Renaissance man who let his life and work be influenced by learning from across disciplines as well as from listening to a wide range of people.

Sound balance sheets, effective risk management, and transparent as well as robust business models are key to strengthening banks’ resilience to shocks, thereby laying the foundations for sustainable economic growth and financial stability. The Eurosystem will submit its response to the European Commission’s public consultation on the EU 2020 strategy, which is designed as a successor to the current Lisbon strategy.

Ultimately, it is the globally consistent implementation and transposition of the agreed policy measures into national laws and regulations that will count. In terms of effectiveness and consistency of these internationally agreed reforms and standards, it is therefore a great plus for the international community that the FSB is strengthening its implementation monitoring.

I would like to focus on three key areas where consistent implementation is most critical: 1. addressing the risks posed by systemically important financial institutions (SIFIs for short), 2. strengthening oversight and regulation of the shadow banking system and 3. putting into effect the new capital and liquidity standards for banks, known as Basel III.

13 • Once the process of balance sheet normalization has begun, it should continue as planned as long as there is no material deterioration in the economic outlook. 14 10 See Board of Governors of the Federal Reserve System (2015), “Federal Reserve Issues FOMC Statement,” press release, December 16, https://www.federalreserve.gov/newsevents/pressreleases/monetary20151216a.htm.

11 See Board of Governors of the Federal Reserve System (2017), “Minutes of the Federal Open Market Committee, May 2-3, 2017,” press release, May 24, https://www.federalreserve.gov/newsevents/pressreleases/monetary20170524a.htm. 12 See Board of Governors of the Federal Reserve System (2014), “Federal Reserve Issues FOMC Statement on Policy Normalization Principles and Plans,” press release, September 17, https://www.federalreserve.gov/newsevents/pressreleases/monetary20140917c.htm.

EMEAP has engaged itself in the project known as ABF, or Asian Bond Fund. In this fund, eleven EMEAP central banks jointly set up their foreign reserves to place investment funds composed of Asian sovereign bonds. The purpose of ABF is to stimulate turnovers in the bond market in this region.

8 [15] See Central Statistics Office Business Impact of COVID-19 [16] Ibid [17] Central Bank of Ireland. "Trends in SME and Large Enterprise Credit and Deposits Q2 2020" 11 September 2020 [18] Ibid [19] Central Bank of Ireland.

A variability interval of plus or minus one percentage point around this objective accounts for price fluctuations which could mainly arise from the non-core components of the National Consumer Price Index.

2 BIS central bankers’ speeches On the positive side, we can be proud to be recognised to be at the forefront of governance and was ranked number one in the following areas: • Strength of Auditing and reporting; • Regulation of securities exchange; and • Efficacy of corporate Boards.

Since the creation of the euro in 1999 until 2005, total crossborder financial assets increased from 87 % of GDP to 124 % in the euro area, and from 80 % to 90 % in the US ; international liabilities increased in the euro area from 92 % of GDP to 137% and from 91 % to 110 % of GDP in the US .

Advanced economies still continue to be the most financially integrated. Yet other regions of the world have also increased their cross border asset and liabilities positions, albeit at a much more moderate pace. These differences can be explained with different capital control regimes as well as a range of other factors, including different degrees of institutional quality and domestic financial development.

The latter service has been hampered by its inability to offer its products in the United States. If the recommendations of the President’s Working Group were enacted, this trading system would be excluded from the Commodity Exchange Act (CEA), and the legal status of products offered through the service would be clear, likely enhancing its attractiveness. Trading systems for swaps.

Development of electronic trading systems for swaps also is likely being hampered by the potential application of the CEA. The CFTC has raised questions about the applicability of the CEA to a system that electronically matches swap trades between dealers. This system automates the functions that voice brokers currently provide in the interdealer market.

First and foremost the business environment needs to improve in the southern regions, above all as regards guaranteeing legality. The technology gap is even greater, public policies are less effective: 75 per cent of unfinished works are located in these regions, of which only 30 per cent are public works.

Concerning the euro area statistics compiled by the ECB, in close cooperation with the NCBs, I would like to recall some recent enhancements: • Since January 2005, the euro area balance of payments has contained a quarterly geographical breakdown of the counterparties involved in transactions with residents. • Furthermore, the international investment position (i.i.p.)

Some data sources on international securities issuance available so far show a pattern of increased reliance on euro-denominated bonds at the beginning of 1999, in particular as opposed to US dollar-denominated bonds.

In short, banks, by their very nature, have a lot more resources than insurance companies, but they also are much more limited in what they can do by the very nature of their funding sources. So, I will cut through some parts of my speech because I am sure that you are in a hurry to be sworn in.

Cajner, Tomaz, Dennis Mawhirter, Christopher Nekarda, and David Ratner (2014). “Why Is Involuntary Part-Time Work Elevated?” FEDS Notes. Washington: Board of Governors of the Federal Reserve System, April 14. Erceg, Christopher J., and Andrew T. Levin (2014). “Labor Force Participation and Monetary Policy in the Wake of the Great Recession,” Journal of Money, Credit and Banking, vol. 46 (October), pp. 3–49.

COVID-19 Period (2020-2021) Finally, in the face of the extreme uncertainty posed by the start of the COVID-19 pandemic in early 2020, we both loosened monetary policy significantly and removed restrictions on LVRs, in order to support the economy and financial system through this unprecedented period.

Otherwise expectations are likely to be disappointed, and disappointed expectations may lead to building pressure for alternative policy actions, which may not in the event be in our longer-term economic interest." This view on what monetary policy can do - and more important what it cannot do - is basically shared by all major central banks.

Our experience with flexible inflation targeting Monetary policy in Canada has been anchored by an inflation target for 30 years. Despite major external shocks—from the 2008–09 global financial crisis to the COVID-19 pandemic—inflation has remained much lower and more stable than it was prior to inflation targeting.

In addition, financial institutions face exposure to litigation from customers, investors and professional counterparties in the event that fraudulent activities are detected. 26. Of course, one has to keep in view the need for hassle-free KYC procedure for general customers, particularly those doing small ticket transactions.

After the initial programmes based on expenditure cuts with significant immediate debt-reducing effects, revenue-increasing measures came to the fore. So, overall, tax centralisation has not been reduced, what happens is that some are paying less tax and others are paying more. Furthermore, the improvement in the budget balance was not accompanied by greater longterm sustainability and the stabilisation of the economic policy outlook.

Such overall rebalancing of the financial asset portfolio in the U.S. dollar financial market enabled major Japanese banks to adjust the liability side of their balance sheets and focus on increasing client-related deposits.

6 See Ichiue, H., T. Kimura, T. Nakamura, and H. Hasebe, "The Supply and Demand of Safe Assets and the Scarcity Premium for Government Bonds," Bank of Japan Review, 12-J-1, January 2012 (in Japanese only). 7 See Bertaut, C., A. Tabova, and V. Wong, "The Replacement of Safe Assets: Evidence from the U.S.

The domestic drivers are making the recovery more robust and resilient to adverse external influences. According to the September ECB staff macroeconomic projections, the economic expansion will continue at growth rates above potential over the projection horizon. Annual real GDP is projected to increase by 2.2% in 2017, by 1.8% in 2018 and by 1.7% in 2019.

So, before getting into the substance of my remarks, I'll provide some brief thoughts on the economic outlook and monetary policy.1 Monetary Policy Let me begin with the FOMC's effort to lower inflation, which continues to be much too high. Stable prices are necessary for a healthy economy and to support a labor market that works for everyone.

* * * 1. Introduction Ladies and gentlemen Central bank communication can certainly be tricky. That is why Bank of Japan Governor Haruhiko Kuroda said three days ago, during an ECB conference on this very issue, that the message needs to be simple. "It should better be straightforward," he told the audience. "That’s the best way."

As was also alluded to at the conference by moderator David Wessel, there might now be a new option that would allow Governor Kuroda to be taken at face value – in the truest sense of the word. Artificial intelligence researchers claim to have found clues in the facial expressions of the Bank of Japan Governor.

Barriers to trade and other forms of protectionism not only interfere with these processes but also block the associated growth of productivity and, more generally, impede an economy's ability to weather shocks.

Under the framework of QQE with Yield Curve Control, of which sustainability and nimbleness have been enhanced owing to the policy actions based on the assessment, the Bank will carry out its mandate of achieving price stability by continuing to persistently conduct powerful monetary easing. To this end, it is important to address the impact of COVID-19 for the time being.

Furthermore, the government is devising plans for economic recovery, including reduction in personal income taxes and corporate taxes as well as additional public investment. It is important to materialize these measures promptly, in such a way that they not only have sizable direct effects on the economy but also contribute to restore corporate and household confidence.

However, in order to reap the full benefits from our monetary policy measures, other policy areas must contribute decisively. Given continued high structural unemployment and low potential output growth in the euro area, the ongoing cyclical recovery should be supported by effective structural policies.

Member - Ms. Bolanle Adekoya (PWC) xi. Secretary - Mrs. Temitope Akin-Fadeyi (CBN) 11. Distinguished Ladies and Gentlemen, today as well, cheques shall be presented to five (5) beneficiaries under the Term Loan Component of the Scheme. These beneficiaries are among the many who 14 submitted their applications via the dedicated portal and their applications processed.

The RBF lends funds to commercial banks, credit institutions and FDB at 2 percent and these lending institutions are allowed to charge interest rates up to a maximum of 6 percent.

In an effort to support sharia industry growth, this year, we have targeted 5% of overall bank assets to be owned by sharia banking. Furthermore, up to 2015, we expect this share to increase to 15%. This is certainly an ambitious target but definitely attainable.

Starting with the parallel run, and both during and after the transition period, the U.S. agencies will rely on ongoing, detailed analyses to evaluate the results of Basel II, so as to ensure prudent levels of capital.

Lael Brainard: Normalizing monetary policy when the neutral interest rate is low Speech by Ms Lael Brainard, Member of the Board of Governors of the Federal Reserve System, at the Stanford Institute for Economic Policy Research, Stanford, California, 1 December 2015.

Against the backdrop of the rise of the Soviet Union and the outbreak of the cold war, the next obvious areas of integration in the early 1950s would have been a common defence policy, which would, in turn, have required a political union.

This sense of confidence would be enhanced by further steps to improve the environment for the accumulation of human capital. If we are able to do this, then I hope that it would become normal for us to live in a highly productive, globally competitive economy with sustainably high living standards and returns to savers.

Accountants perform several roles in an economic system including, amongst others, auditors, consultants, financial analyst, tax planners and business advisers and influence the lives of millions of people globally. Their skills and competence are sought by companies, ranging from the smallest ones to the large multinationals and their audit reports are viewed by millions, including shareholders, governments, regulators, investors and the public at large.

And we should not blind ourselves to the fact that we will continue to experience headwinds here: from those who go against internationally agreed policies and rules, from those who think banking and the economy would profit from a looser grip, and from those in the financial sector who claim that they’ve been treated unfairly and that they’ll have a hard time coping with the standards.

In Europe and in Germany, some have been expressing opinions along the lines of that third argument in particular.

Parties sensed – or feared – that voters would not easily accept continued support operations to stabilize the finances of the weaker euro area countries, and the issue became heated. There were even worries that Finland would prevent EU support for Portugal. 6 BIS central bankers’ speeches This happened although the euro has enjoyed relatively strong support in Finland.

According to the Eurobarometer survey conducted last November, 78% of Finns supported the common currency and less than 20% were negative about it. And of course, Finns have been much more positive about the euro than the other Scandinavian nations, for instance.

The most interesting group of technologies, in my judgment, are those which have recently moved out of their limited niche markets into mass adoption. A short list would include the Internet, which is a whole new distribution system in itself; debit cards, which use existing credit card and regional ATM networks; and on-line investing, which relies on the Internet.

The Internet really only blossomed into mass adoption in the mid to late 1990s with the advent of numerous simple tools for “surfing the web.” On-line investing has just begun to push into early mass adoption.

That is why we will only allow a short time for the two sets of coins to circulate together before we withdraw the old ones. Old coins Our old coins, including the 1 and 2 cents coins will be officially demonetised on 31 March 2009 meaning they will cease to be a legal tender from 01 April 2009.

There was limited recognition of – and standards for – collateral use, limited recognition of offsets, with respect to long and short risk positions and there was lack of recognition of portfolio diversification effects.

However, little attention was given to these recommendations because there was no sense of urgency. The respective economies were still growing and there were no signs of crisis. The same applies today: as the world is gradually recovering from the crisis, the focus seems to have turned again towards very short-term targets related to growth and employment, but with little consideration paid to sustainability.

The member country has to abide by common monetary policy for the union as a whole; and it has to relinquish its exchange rate, an instrument for protecting itself from economic shocks.

As a civil servant for more than four decades, uplifting the lives of the poor and low-income households has always been one of my thrusts. And here at the BSP, I am glad to be able to contribute to that in a tangible way. The photo you see now shows the winners of the CMA in 2018.

That said, the benefits of a lengthy recovery can only go so far, as the research points to some barriers to labor market outcomes for particular groups that appear to be structural.

Again and again, we are reminded that when products are free, the consumers themselves may be the product. For instance, many financial apps that provide “free” services earn revenue by being paid for lead generation.

In normalizing, we are mindful of the need to safeguard economic recovery on one hand and to control inflation on the other. Achieving that balance requires a well-calibrated and well-communicated exit strategy to avoid substantial market volatility, reduce spillovers, and continue the recovery momentum. Last May 19, we raised the key policy rate from a historic low of 2.0 percent to 2.25 percent.

The recommendations will focus on specific tools to strengthen the implementation and governance of conduct standards by market participants as well as on areas where changes to financial markets legislation and associated subordinate legislation are required to support a new conduct framework for wholesale financial markets.

4 Raj Chetty, David Grusky, Maximilian Hell, Nathaniel Hendren, Robert Manduca, and Jimmy Narang, “The Fading American Dream: Trend in Absolute Income Mobility since 1940,” Science, vol. 356 (April 2017), 398–406; Raj Chetty, Nathaniel Hendren, Patrick Kline, and Emmanuel Saez, “Where Is the Land of Opportunity? The Geography of Intergenerational Mobility in the United States,” Quarterly Journal of Economics, vol. 129 (November 2014), 1553–623.

Thus, for example, the points awarded for a securities referral could not exceed the amount of points awarded for a safe deposit referral, even if the points awarded for the securities referral were nominal in amount.

Failure to address all exceptions or adopt cure or leeway periods The interim final rules also fail to address the scope of a majority of the exceptions to the definitions of "broker" and "dealer" that were adopted in the GLB Act.

The annual August Kansas Federal Reserve’s summit of many of the world’s central bankers vividly highlighted our commonality. Inflation has been low and stable, and many labour markets are near their peak loading. New Zealand included. Independent central banks have successfully achieved their inflation goals, promoting economic wellbeing. Yet, there was no vigorous back patting. There were mostly furrowed brows.

A slowing global economic outlook, increasingly prompted by pockets of volatile politics, is keeping the world’s central bankers busy. In response to the economic chill, central banks around the world have lowered interest rates – often to record lows – to promote investment and spending. They continue to pursue their mandated low inflation goals. That’s our job.

So far, the exposure and default rates on advances to the consumer, SME and agriculture sector has been manageable as the risk management systems within banks have improved significantly. Greater disclosure requirements, strengthened corporate governance structure and Credit Information Bureau, which now provides access to the credit reports of all borrowers, irrespective of the loan amount, are all effective risk mitigants.

Herding may occur, for instance, if market participants extrapolate a series of recent price increases as reflecting better “fundamentals”, and then choose to follow such price movements. BIS central bankers’ speeches 3 To enhance transparency First, the transparency of both physical-products and commodity-derivatives markets needs to be enhanced.

More recently we have been giving the market more guidance as to how we view the risks to our forecasts. A number of independent academic studies have confirmed the increased predictability of monetary policy in South Africa.

A study by Janine Aron and John Muellbauer at Oxford University shows that 2 BIS central bankers’ speeches the forward rate agreements (FRAs) have anticipated repo rate changes well since the introduction of inflation targeting.

For example, in 2010, we issued a cease and desist order against HSBC requiring the U.S. holding company to improve its oversight of the compliance program at HSBC’s national bank subsidiary.5 HSBC’s failure to address our concerns in a timely manner was part of the reason for imposing a substantial penalty on HSBC and its U.S. holding company last year.6 The Federal Reserve takes seriously its responsibility to pursue formal, public action in cases of BSA non-compliance.

Therefore, when Croatia introduces the euro, the risks of doing business with Croatia will be lower because the foreign exchange risk of changes in the value of the kuna against the euro will be eliminated. Also, exchange operations (currency exchange operations) will be simpler because the same money will be used in 17 other countries.

Nonetheless, the core function of HRD is to facilitate performance improvement and/or personal growth within the institutional goal of delivering value to customers and maximisation of value-added. Capital and technology are replicable, but not human resources. Accordingly, the fundamental principle of human resource management (HRM) is to treat people as an asset rather than as a mere factor of production.

The emphasis on human resource management is in the common interests of management and the workforce: by enabling employees to actualise their full potential, the collective goal is achieved. Personnel policies and practices including elements like ‘institutional culture’ have to be integrated with the business strategy.

once we are well into 2001/02 - is that it will be in the 2-3% target range, probably in the upper half.

It is this class of “small” farmers, operating at the margins – socially as well as financially, with low income base and limited market orientation, vulnerable to climate changes and facing considerable risk in their agricultural operations – that define the profile of the clientele of cooperatives.

To repeat what I said five years ago here in Grand Rapids before the Gerald R. Ford Foundation: institutions are needed that give free play to the inventive capacities of people and effectively promote the translation of conceptual innovations into increased output of goods and services that are the lifeblood of material progress.

What these particular institutions should be has not always been as clear as it is today. Much of this past century, in effect, has been a test of whether capitalist institutions or more centrally planned socialist institutions would work better, over the long run, in serving the needs of human society.

Monetary policy has achieved a high degree of policy credibility. And for the SSM it is perhaps too early to judge, though I am certain we would not have had such a rigorous clean-up of our banking sector without it. If we look at the rules-based approach, however, it is difficult to reach such a positive conclusion.

However, if such protectionist moves bring about turmoil in global financial markets and deterioration in firms' sentiment, downward pressure on the global economy is expected to be around 0.5 percentage point at most. Global economies have become more interdependent than ever before, with the recent progress in globalization and information technology.

The timing of this conference is highly appropriate as we are entering a new phase in the South African payment and financial regulatory environment, coupled with significant changes to the international regulatory architecture and framework.

Not only do we have to contend with challenges in our domestic environment, but we need to be cognisant of the challenges facing the global economy, such as pedestrian growth, low commodity prices, increased geopolitical risks, and a high degree of market uncertainty and volatility. All these factors combined make the economic and financial environment very challenging and rapidly evolving.

For banks, the possible applications, in addition to making it possible to reduce regulatory compliance costs and make back-office operations more efficient, allow them to fully exploit the enormous mass of data (structured and unstructured) they have access to in order to offer products better suited to customers’ needs.

The use of technology may also contribute to making the entire credit cycle more efficient (from origination to monitoring, and from restructuring to recovery). Innovations should, however, be planned over time; it is especially important to have staff that are adequately trained and open to change.

We will need to keep going until we see inflation sustainably reaching 2%, in an environment of robust growth and rising employment. For these reasons, policy support will have to remain in place well beyond the end of the pandemic. 1.

Panetta, F. (2020), “Asymmetric risks, asymmetric reaction: monetary policy in the pandemic”, speech at the meeting of the ECB Money Market Contact Group, 22 September. 2. ECB (2020), “Eurosystem staff macroeconomic projections for the euro area”, December. 3. of Recoveries”, mimeo. 4.

So, what should be the key requirement on our dinarization strategy? The strategy needs to have realistic objectives, and be technically feasible. It also has to involve all key stakeholders and to minimize the risks of adverse side-effects on the economic recovery or other segments of the economy. Next, what extent of dinarization is achievable?

(1776), An Inquiry into the Nature and Causes of the Wealth of Nations, edited by C. J. Bullock. Vol. X. The Harvard Classics. New York: P.F. Collier & Son, 1909–14. Weber, A. (2007), Challenges Posed by (Financial) Globalisation, Lecture at the University of Pune, Pune, 15 March.

Admittedly, it is the nature of financial markets that perceptions of risk evolve over time, resulting in at least some degree of price volatility, even in those markets perceived as among the safest. Policymakers cannot completely eliminate financial market volatility. Yet in the recent past, some emerging countries have used specific tools to try and limit the extent of such volatility.

These include irregularities in draft acceptance and discount, dishonor by nonpayments, fake drafts, and unregulated innovation. Other aspects of the weaknesses include the decentralized markets and inadequate use of information technology. These problems could lead to financial risks, threaten fund security, and hamper the development of the draft market. Electronic drafts provide an effective solution to these problems.

BIS Review 77/1997 - 11 - It must not be expected, however, that the introduction of the new system will lead to a permanently lower level of interest rates. The Reserve Bank may well in future use interest rates more frequently and extensively to pursue its overriding objective of protecting the value of the currency.

An example of both the political pressure that can be exerted on the central bank, as well as the inflationary consequences of debt monetization is currently playing out in Argentina. The president of Argentina recently forced out the Governor of the Central Bank because he would not transfer reserves held at the central bank to repay Argentinean debt.

Dogmas can and indeed should themselves become part of the curriculum – not just at schools but at universities, too. Yet while appreciating that economic education warrants a higher status in schools, we should not forget one thing. Economics is a highly complex topic – as I’m sure you will agree.

 A strong institutional mechanism at the level of banks through 35 State level Bankers’ Committees, 644 Lead District Managers and more than 100 thousand bank branches.  More than 700 Financial Literacy Centres and RSETIs imparting financial literacy to complement the financial inclusion measures. Recent financial inclusion initiatives 5.

In South Africa, we tend to engage in this debate through rhetoric rather than facts. In our article published on 2 July, we set the basis for a more informed discussion.1 I would like to open the next chapter in that dialogue tonight. Let me start by asking: why does our money have value? Why can you exchange it for goods and services?

Annualised growth in real gross domestic product accelerated from 3,5 per cent in the first quarter of 2005 to 4,8 per cent in the second quarter, with firm growth recorded in virtually all the main sectors of 1 Alan Greenspan in his testimony to Congress on 3 November 2005 said: “The bottom line is that in periods of extreme chaos, it’s turned out that gold has been the ultimate means by which transactions have been consummated.

Frequently, this person would turn up at another financial firm not long thereafter. The dismissing firm’s reasoning was that any public awareness of the dismissal could hurt the reputation of the firm and perhaps cause customers or counterparties to rethink their willingness to do business with it.

But the effect of this private way of doing things was to signal the rest of the firm’s employees that dismissal, even for very serious reasons, carried quite manageable consequences. At least some firms are rethinking this traditional approach, though different banks seem to be reaching different conclusions about what to put in its place.

Thus, the long phase-in period of the new Basel III capital requirements prevent disruption in credit flows and bring enough clarity and scope for banks to smoothly absorb the necessary adjustments over time. This implies in turn that the transitional costs for real economic activity are likely to be relatively moderate and distributed over the long implementation period. III.

After all, the BIS has been the principal forum for developing international supervisory standards for banks in industrialized countries and, by their voluntary adoption, for banks and bank supervisors in other countries throughout the world. Bilateral discussions can also serve useful functions either where particular issues are of concern or as a basis for subsequent broader dissemination.

While euro area banks are clearly better capitalised and more resilient, this exercise should not hide the fact that areas of vulnerability remain. In particular, banks are still struggling to achieve sustainable profitability.

Admittedly, headline profitability figures show that the sector seems to be 1/7 BIS central bankers' speeches improving rapidly – the average return on equity for euro area banks increased from 3.4% in 2016 to 6.9% in the second quarter of 2018. However, more careful analysis reveals that this improvement is mainly due to a reduction in the cost of credit risk.

The large cooperative structure with deep penetration and endowment of local knowledge is an ideal platform for furthering financial inclusion. Arguably, cooperatives have been in the business of financial inclusion long before the phrase became fashionable. 27.

Within three years only, the level of NPLs was slashed by more than 60% and their share in total loans by 14.6 percentage points – from 22.4% in July 2015 to 7.8% in June 2018. This is the lowest level of the NPL ratio since its monitoring began in late 2008.

Therefore, it is also an opportunity to elaborate on the main features of future cooperation. • Third, but by no means least, this seminar offers a unique opportunity to strengthen professional and personal relationships between all central bankers of the region. Part of the region is haunted by conflicts, which impact the economies.

As a matter of coincidence, I started my governorship at the Bank of Mauritius with the outbreak of the pandemic. This theme is attracting significant attention globally. The BIS, IMF, OECD, OMFIF and many central bankers are relentlessly reflecting on how best to maintain stability and resilience of the banking sector.

It is worth remembering that in 12 of the 17 members of the euro area, the respective central banks have responsibilities in banking supervision. After the crisis, the trend in several BIS central bankers’ speeches 5 countries has been to change the system of banking supervision by giving that responsibility to the respective central banks.

Regarding macro-prudential policies, the Eurosystem (the ECB plus the National Central Banks) was already given a special role in supporting the mission of the European Systemic Risk Board. All this points to a possible future development in the direction of giving a more significant role to the Eurosystem in the supervision of banks, in particular of large cross-border banking groups.

Germany’s future challenges, however, make some changes in fiscal policy advisable. Where Germany’s growth potential is concerned, there is consensus that higher public investment does have a role to play. The size of the investment gap, however, is probably more difficult to gauge. National definitions of public investment differ, which is just one reason why a European average is a flawed benchmark.

Rasheed Mohammed Al Maraj: Regulatory perspectives – strengthening industry foundations to sustain growth in a challenging climate Keynote address by His Excellency Rasheed Mohammed Al Maraj, Governor of the Central Bank of Bahrain, at the 17th World Islamic Banking Conference, Manama, 23 November 2010.

3 In short, the full set of post-2008 reforms—as refined and recalibrated by the work of the last four years—ensured that this time would truly be different than the last. Today, the U.S. banking system is actually more liquid and better capitalized than it was a year ago, with over $ billion in additional loan loss reserves, leaving it wellpositioned to weather future shocks.

While a strong recovery is underway, it is not yet complete. 4 Some households and businesses are still vulnerable, even as we enter this last stretch of the return to normal. Our role, as policymakers, is to support the financial system and the economy through the end of this transition back to normal operations.

In addition, Africa has embraced the New Partnership for Africa's Development (NEPAD) to confront the challenges facing the continent. It is a strategic development plan that addresses the economic, political and dimensions of Africa's future development. NEPAD is a clear demonstration of the willingness of the continent to take responsibility for its own actions and for its future.

It is a new start for Africa to meet the Millennium Development Goals and targets. Crucially, the vision and way forward include, building political consensus and the necessary institutions as well as determining the 2 BIS Review 44/2003 pace of implementation of the programme. NEPAD aims to reduce poverty by significantly increasing economic growth throughout the continent.

The Bank of Israel advises the government on how to increase the long-term growth rate, and indicates main policy measures that can increase the long-term growth path: in the areas of education, infrastructure, and bureaucracy.

The Bank is currently working diligently on a formal report containing the Bank’s recommendations to the government regarding the advancement of productivity in the economy and an analysis of their expected costs and benefits in the long term, which we will publish soon.

In theory, it is fairly straightforward to define market power. In practice, however, it is difficult to pin down the level and evolution of market power empirically. There are two reasons for this. First, markups are not directly observable. Second, there is no one-to-one mapping between firms’ market power and point-in-time markup estimates.

A firm with a small markup at any given moment can have significant market power when its pricing strategy aims to build up an ever-larger market share. As a result, assessing the level of firms’ market power requires a variety of approaches to measure markups and a broad range of indicators (such as the evolution of firm concentration and firm dynamics).

As an input to this, the RBA assessed that the banks could reasonably hold 25 per cent of the stock of AGS and semis. This was a sizeable step up from their holdings earlier in the decade (Graph 3). Graph 3 However, since then, the stock of AGS and semis has increased by almost a third.

In comparison, the LCR requirements of the banks have been little changed. So the banks can hold more HQLA securities compared to their liquidity needs. As a result, the size of the CLF has declined to just below $ billion.

The post-crisis phase of this cycle has been characterised by an understandable tendency to strengthen regulation and supervision. This is natural when the memory of the consequences of light-touch regulation is still fresh. However, as the memory of the crisis fades, the cycle usually enters a phase where regulation and strong supervision are perceived as a hindrance to growth and markets.

In contrast, although the contraction in capital spending appeared to have slowed, we had yet to see any convincing signs that a sustained pickup in business spending was emerging. Moreover, heightened geopolitical tensions were adding to the already considerable uncertainties that had clouded the business outlook over the preceding three years.

More advanced supply-chain management and flexible manufacturing technologies have enabled our firms in recent years to adjust production levels more rapidly to changes in sales, but apparently these improvements have not yet solved the thornier problem of anticipating demand.

The SBP has developed a regular consultative mechanism whereby the views and comments of Pakistan Banking Association are sought and incorporated in the draft policies, circulars and regulations. Fourth, the role of market discipline and monitoring has to be enhanced.

An inspection of the relationship between the development of national debt-to-GDP ratios and sovereign yield spreads relative to Germany 1999 – 2006, indicates that the improved creditworthiness of the EMU member states since 1999 can explain some of the decline in the spreads (see slide 10).

However, credit risk is only one of the factors that determine the size of the spreads and should therefore not be viewed in isolation.

Europe has changed dramatically over the last decades. Today’s Europe is no longer characterized by “hot or cold” conflicts, but by peaceful coexistence and the mutual respect of nations. The EU has played a major role in this historic success.

Appeasement policies starting immediately after World War II in Western Europe resulted in the establishment of the European Coal and Steel Community in 1951 and in the foundation of the European Economic Community (EEC) in 1958.

4 Therefore, the use of the term "banking crisis" in our research refers to major disruptions in a country's banking system, not just minor downturns or disturbances. By focusing on banking crises in our research paper, we were able to isolate the impact of banks on the provision of credit and liquidity to firms during times of distress.

The idea that we should stop borrowing from the social security trust fund to finance other outlays has gained surprising - and welcome - traction, and it establishes, in effect, a new budgetary framework that is centered on the on-budget surplus and how it should be used. This new framework is useful because it offers a clear objective that should strengthen budgetary discipline.

The main element that the IMF has at its disposal is bilateral and multilateral surveillance work, with which it regularly examines the economic developments and policies at the national and international level. Ladies and Gentlemen: One can also identify a shift in the crisis prevention strategy the IMF employs. Indeed, mistakes were made in assessing vulnerabilities up to the Asian crises.

But now the IMF is concentrating on identifying vulnerabilities such as excessive sovereign debt or balance sheet mismatches. Also, its stance on capital account liberalization has changed. Now the IMF advocates that member countries should first have the institutional capacity and a relatively strong financial sector with a good supervision before taking this major step of liberalization.

Failing to properly recognise the impact of domestic policies on others, and the second round feedbacks on the domestic economy can be detrimental to growth and stability. 2 BIS central bankers’ speeches An excessive focus on the domestic economy may exacerbate global economic and financial imbalances, ultimately making future global crises more likely and more severe.

This is all the more true for systemically relevant countries, which have a special obligation for international cooperation. 3. What are recipes to prevent imbalances and their spillovers? Sound macroeconomic policies at the national level can – of course – help to address external shocks and spillovers.

Additionally, and as Professor Boeri has recently pointed out, 6 there can be no steps backward in undertaking and implementing reforms, particularly with the need for greater flexibility in this era of rapidly changing economic environments. Being here in Amsterdam today, on this given occasion, I should also like to take the opportunity to recall the successful transition to Economic and Monetary Union (EMU).

It was here in the Netherlands where the milestones, on the way to this truly historical achievement, were set. The Maastricht Treaty, signed in February 1992, and the Stability and Growth Pact, sealed here in Amsterdam in June 1997, laid down the institutional framework for EMU, which provided the basis for the successful transition to the euro and the ECB’s price stability-oriented monetary policy.

Market-led initiatives, such as the Glasgow Financial Alliance for Net Zero (GFANZ)2 or the Task Force on Climate-Related Financial Disclosures (TCFD)3 have already published frameworks on transition plans. Following the market-led initiatives, the public sector is moving, too. Regulators will expect the disclosure of transition plans in the future.

From 2025 [for fiscal year 2024], EU companies falling within the scope of the CSRD4 will have to disclose transition plans. The UK, which is clearly a transition-plan pioneer, is even more ambitious. Its Financial Conduct Authority (FCA) already now requires listed companies to disclose transition plans on a 'comply-or-explain' basis.

Many countries have strengthened the institutional framework for financial stability in light of the experiences from the crisis, and have incorporated and undertaken a new approach; in particular a macro-prudential dimension of monitoring interconnectedness in order to design policies to mitigate systemic risk.

This demographic bonus will likely remain in place for more than another ten years. The economy is largely concentrated in services, which account for more than 60 percent of total production, while industry represents more than one-third, and agriculture around 3 percent. Competition through foreign trade has made many sectors, especially manufacturing, more efficient.

By contrast, the home-grown 1 I wish to thank A. Mehl and M. Fratzscher for their contribution to preparing this speech. The opinions reflect those of the author. BIS Review 156/2008 1 “anomalies” and imbalances were more clearly reflected in large external imbalances at global level. These were more widely recognised and acknowledged.

In fact, many of the macro roots of the current crisis were behind the widening of global imbalances in the last decade. Let me just mention three issues: • First, the marked asymmetry characterising the global financial system.

Specifically, a baseline is constructed centered on the median of the SPF projections released in May, and then the model is repeatedly simulated with shocks drawn from the set of historical disturbances experienced over the period from 1968 to 2011.

Various studies including those published in our very own Agriculture Finance Year Book have demonstrated that these tax incentives did not result in any significant gains to farmers in the form of either reduced input prices, or an increase in lending to the agriculture sector.

Although there is no one to one relationship between budget deficits and trade deficits in our context, the case for a reduction in budget deficit is strong. Fiscal dentistry needs to be carried out; the cavities need to be filled in. On the monetary policy side, stringent demand management policy is the order of the day.

Who has the main instruments to achieve this objective? By and large, it’s the Member States which are responsible for most of the policies that affect economic growth, from education to product and labour market regulation, from taxation to research and technology, etc.

However, corporates should seize the opportunities, which are better now than in the past, provided by the ample liquidity available to investors in the capital markets, to bridge the gap vis-à-vis firms of the other main European economies.

Since the beginning of 2020, net issues of debt securities and listed shares by Italian companies have amounted to € billion, compared with € billion for French firms and € billion for German firms.

We will at the same time endeavor to keep inflation at manageable levels as this creates the environment for sustainable long-term growth. The BSP’s external sector policy will remain focused on ensuring our external vulnerabilities are limited. We expect to continue to post a surplus in our BOP, mainly still due to steady OF remittances and receipts from the BPO sector.

This will give us the opportunity to further beef up reserves for insurance. We will continue to pursue a market-determined exchange rate to allow us to maintain external competitiveness. We will also engage in policies that would sustain a manageable external debt profile. Banking sector policies will continue to reinforce the banking system’s soundness.

Compared to an estimated saving of 0.5% of GNP from the common currency in the EU, the magnitude of this advantage for Namibia appears to be quite sizeable. This is to be understood given the fact that close to 90% of Namibian imports come from South Africa.

3 BIS Review 127/1999 Access to financial markets Though not the least important, a major benefit from the CMA arrangement is the free flow of capital between the member countries. This provides wider access to financial markets and thus helps in satisfying extraordinary financial requirements for the infrastructural projects in the country.

4 The majority of FSB staff members are on temporary secondments from member institutions. 5 In addition to the 70 member agencies from 24 member countries, the FSB has six regional consultative groups to disseminate information and collect feedback from an additional 70 non-member countries.

If I were still living in Frankfurt which I left eight years ago, I would certainly be among the first users of this web page as the main source of information for transactions to Serbia.

Speech by Frank Elderson at DNB Banking Seminar “The art of transformation - will banks keep up?”, Amsterdam, Hermitage, 8 February 2017 Ladies and gentlemen, Throughout time, mankind has been shaped by wave after wave of changes. Economic boom and bust. Social and political upheaval. Scientific developments that transformed how we travelled, produced and consumed.

These changes were reflected in - and influenced by - the evolution of banking. In Babylonia, merchants made grain loans to farmers. In ancient Greece, lenders began to accept deposits and change money. And in the 17th century, Amsterdam became a centre of derivatives, short selling and proprietary trading. Today, banking is a global industry.

In the first nine months of the year, the annualized return on equity rose to 6 per cent for Italian banks as a whole, from 4 per cent in the same period of 2017.

If you look at the Wikipedia entry for this in English, you will find listed, among other things, the production of knowledge and of official statistics, flood control systems, and lighthouses (yes, lighthouses that signal to ships the position of certain points on the coastline; as to why Wikipedia mentions them, we shall see that shortly).

In October 1992, when the unemployment rate was 2.2 percent, the same level as in July 2019, the labor force participation rate was 64.2 percent, which is about 2 percentage points higher than that of July 2019. This implies the possibility that the labor market conditions are less tight now than in 1992.

This is also obviously a result of education trends – the rate of higher education among the ultra-Orthodox population is particularly low, and we cannot distinguish a higher rate of those holding an academic degree among the younger population, which is certainly a worrying phenomenon.

The policy response to these pressures and the anticipated divergence between the policy trajectory in these economies and the United States contributed to a 10 percent appreciation in the dollar in inflation-adjusted terms through the spring of this year, pushing down net exports and restraining activity in the United States.

Net exports subtracted nearly 1 percentage point from the annual rate of U.S. BIS central bankers’ speeches 3 gross domestic product (GDP) growth in the first part of the year, and the most recent trade data suggest another substantial subtraction in the third quarter.

Building on the success of SCAP, the Board moved to the current stress testing assessment, known as the Comprehensive Capital Analysis and Review (CCAR), to evaluate whether the largest firms have sufficient capital to continue to lend and absorb potential losses under severely adverse conditions.

Global liquidity is intensely procyclical, with the complacency fostered by periods of excessive global liquidity contributing to the buildup of large mismatches across currencies, maturities and countries. History suggests that the greater the reliance on cross-border liquidity, the more extreme these cycles can be, and the larger the disruption when they turn.

And as to friction between the central bank and the political system, during my term it was in fact most intense around issues related to the core activity of the Bank of Israel in supporting financial stability.

We aim to reflect the Treaty principles of partnership, protection, and participation within the core tenants of our strategy. We seek to implement our legislated purpose through the concept of Matangirua ki Matangireia – working in unison, to fulfil our ultimate purpose. At Te Pūtea Matua, we strive to be a great team working to be the best central bank we can.

That is, it does not imply that each instrument must be dedicated to a single target. 8 BIS central bankers’ speeches described, I can imagine situations where it might make sense to enlist monetary policy tools in the pursuit of financial stability. Let me offer three observations in support of this perspective.

First, despite much recent progress, supervisory and regulatory tools remain imperfect in their ability to promptly address many sorts of financial stability concerns. If the underlying economic environment creates a strong incentive for financial institutions to, say, take on more credit risk in a reach for yield, it is unlikely that regulatory tools can completely contain this behavior.

This assessment is also reflected in the March 2009 ECB staff macroeconomic projections for the euro area, which place annual real GDP growth in a range of -3.2% to -2.2% in 2009, and between -0.7% and +0.7% in 2010. These ranges represent a downward revision of the December 2008 Eurosystem staff macroeconomic projections.

In both 2009 and 2010, the annual GDP growth rate will be significantly reduced by negative carry-over effects from the previous year.

Based on the Tankan. All enterprises. 2. Shaded areas denote recession periods. Source: Bank of Japan. 40 Chart 6 Corporate Sector in Japan Corporate Profits 400 Business Fixed Investment s.a., tril. yen s.a., tril.

yen y/y % chg. 25 20 380 20 360 15 Private nonresidential investment (SNA, nominal) 15 Tankan (actual) 10 Tankan (planned investment in current fiscal year as of the June survey of each year) 5 0 340 10 320 Sales (left scale) 5 300 Current profits (right scale) 280 CY 07 11 13 15 -10 -15 0 09 -5 17 19 21 Notes: 1.

I should hasten to add that the BOG co-operates with international financial institutions in fighting the cross-boarder aspects of financial fraud.

Mr. Chairman, I am convinced that the most critical tool that can be used to combat financial fraud in our environment is collaboration within constitutional and statutory bounds among all the institutions of the State that have a part to play in the detection, investigation and prosecution of financial frauds in every aspect of our national lives.

They include the print and TV adverts, our euro information website, the public information leaflet that has been produced for 200 million households, the cash-handler training material, the national euro conferences, and the information kits given to the media in the countdown to the euro this year. We will continue to monitor the changeover and will provide you with regular press releases in January.

While I am on the subject of the media, let me just say a personal word to reporters and editors who have covered the euro story. I think that you have done a remarkable job of making people realise that they need to learn and to prepare.

The monetary policy targets in the Government’s Strategy for Growth, Employment and Redistribution (GEAR) cannot be achieved unless all the other goals for structural adjustment are also achieved at the same time.

Let me once again congratulate the Department of Business Economics of Delhi University South Campus for selecting a very topical and relevant theme for this convention. I wish the convention every success. Thank you. 12 BIS central bankers’ speeches

In fact, the larger threat to the strong labor market is excessive inflation, which if allowed to continue could lead to a further economic softening, risking a prolonged period of economic weakness coupled with high inflation, like we experienced in the 1970s. In any case, we must fulfill our commitment to lowering inflation, and I will remain steadfastly focused on this task.

With my outlook out of the way, let me turn to another of my responsibilities at the Fed, which is bank regulation and supervision. I am sure that we will have the opportunity to discuss many issues of interest to you during our discussion, but I’d like to mention a pending rulemaking that would update the Community Reinvestment Act.

This has been illustrated by a significant convergence in interest rate differentials in wholesale and interbank markets, by a significant degree of convergence for the cost of capital for equity and debt issuance across countries and, by a gradually decreasing home bias in the composition of asset classes in most regulated investment funds.

This closer integration has been facilitated by the growing importance of the euro as a reserve currency, as well as by the rapid technological advances that have enabled markets to operate more easily in a cross-border environment. As financial markets have become more inter-connected, the structure of banking markets and their management has also changed significantly.

My view – that recent changes in inflation dynamics result primarily from better-anchored inflation expectations and not from structural change or simply the achievement of a persistent low rate of inflation – implies some very good news: Potentially inflationary shocks, like a sharp rise in energy prices, are less likely to spill over into expected and actual core inflation.

In my judgment, while the completeness of markets will remain an elusive goal, and the depth and breadth of financial markets will invariably be tested in ways that punish the ill-advised and unprepared, the secular trend toward more complete markets is unlikely to abate. Cyclical variances, however, are far more difficult to predict with precision.

Indeed this has been a focus of attention worldwide, with for example the IMF’s World Economic Outlook report devoting attention to the issue in each of its five semi-annual reports between April 2008 and April 2010.

Interestingly, the estimated losses for the global financial system from this source have oscillated, growing from the first estimate of $ trillion to reach a maximum of $ trillion before falling back to the latest estimate of $ trillion (Chart 5). Clearly these estimates are not easy to pin down. This is not an exact science.

Recognising this uncertainty, ECB staff forecasts, as published recently in our Financial Stability Review, suggest that euro area banks could potentially lose around USD 280 billion between now and the end of 2010, largely as a result of their loan exposures. This is substantially lower than IMF staff forecasts.

So when it comes to money matters, this lady is not to be underestimated. However, she has invested the bulk of her money more conservatively – in call and fixed-term deposit accounts, for example. But what has long rankled this lady is the fact that call and fixed-term deposit accounts earn practically no interest anymore.

That may not be a lot of immediate help to most people because they would be unsure of what time span was encompassed by an economic expansion. As a point of reference, the last two expansions have lasted for about six-and-a-half years, but I think we can do a lot better on this occasion.

Third, and especially for the richest households, one should account for all assets, including those held abroad, which tend to be more difficult to trace. A key approach used by Gabriel to overcome these challenges is the “income capitalisation method”, which uses fiscal data on capital income to estimate the wealth distribution.