The exchange against sound collateral ensures that the central bank is not directly involved in bailing out banks. This avoids moral hazard and prevents the central bank from distorting the process of price determination, including loss discoveries. This is a well known principle established by Bagehot in 1872.
But our quest for efficiency enhancement and innovation continues. So let me give you a very brief overview of what you may expect from the Bank of Mauritius in the months ahead.