It is essential to structure and put in place financial safety nets with supportive legislation on a timely basis for banking sector to grow in a sound and efficient manner, while managing properly its systemic risks. Empowering and gearing the primary regulator will be key to keeping on track and effectively implementing the reform agenda.
We are supportive of efforts by the private sector to develop such term rates. However, there would need to be significant effort to develop the appropriate market infrastructure and practices before these could be considered robust benchmarks. Given this, we encourage market participants to consider using the cash rate rather than waiting for the development of a term rate.