The Bank of Thailand is rolling out a new measure in the second half of this year with a view to giving banks a nudge to deal with NPLs head on. For NPLs that have long been pending without proper restructuring or legal actions, financial institutions will be required to set aside provisions for the collateral at an increasing rate, depending on the overdue period. Essentially, banks will be required to  2  BIS Review 43/2004  make provision in full, regardless of the collateral value, for loans that have been non-performing for over four years. Also, the Asset Management Corporation, set up exclusively to buy NPLs from the finance companies that were closed down during the crisis, will be enabled to buy NPLs of banks. We are now in the process of amending the Corporation’s charter. On risk-based supervision, the Bank of Thailand has issued a Market Risk Supervision Policy framework at the end of last year - a timely move given a possible upward trend of interest rates. This measure will ensure that financial institutions instill mechanism to manage market risk commensurate with their risk-taking activities, especially in the trading book. Recognizing the need for financial institutions to adjust, the Bank of Thailand will implement the measure in transitional phases. By June 2005, banks will be required, for the first time, to maintain capital fund against market risk.
(ii) Data disclosure and stress test methodologies, in order to measure more and more precisely and credibly climate-related risks of financial institutions. It is a prerequisite before possibly deciding about additional capital requirements. For these tasks, believe me: we in NGFS are ready to “roll up our sleeves”, and still have the enthusiasm of the pioneers. ** In conclusion, acceleration has been the name of the game since 2017. Still, we should further accelerate in 2021. We have an exceptional political alignment, with major international milestones: the COP26 of course, but also a G7 summit in June, a G20 conference in July in Venice, and a G20 summit in October in Rome. It is time for all policy makers – us included – to be up to Hans Jonas requirement, for the future wholeness of Man. Thank you for your attention. i  Hans Jonas, The Imperative of Responsibility: In Search of an Ethics for the Technological Age. Responsible Investment Report of the Banque de France 2019, June 2020. iii “Progress report on bridging data gaps”, NGFS Report, 26 May 2021. iv “The role of central banks in the greening of the economy”, Speech by François Villeroy de Galhau, 11 February 2021 v “Adapting central bank operations to a hotter world: Reviewing some options”, NGFS Report, 24 March 2021. ii