•  Banks need to improve the transparency, quality, accuracy and timeliness of information to support risk management. •  Institute enterprise wide risk management systems instead of managing the risks in silos. •  Use both qualitative and quantitative techniques with varied assumptions instead of blindly following the models. Ladies and Gentlemen!
Rigid exchange rate regimes may enhance monetary policy credibility and lower inflation with little costs particularly in countries with low exposure to international capital movements. But as a recent IMF study indicates, these economies are often developing countries. Nevertheless, in emerging economies with relatively large financial markets and large capital movements, rigid exchange rate systems might be quite a risky choice.