Andrew G Haldane: Towards a common financial language1 Speech by Mr Andrew G Haldane, Executive Director, Financial Stability, Bank of England, at the Securities Industry and Financial Markets Association (SIFMA) “Building a Global Legal Entity Identifier Framework” Symposium, New York, 14 March 2012. *  *  *  The views are not necessarily those of the Bank of England or the Financial Policy Committee. We would like to thank Alan Ball, Peter Davies, Priya Kothari and Colin Miles for comments and contributions. In the first book of the Old Testament, God punishes the builders of the Tower of Babel for their folly. The choice of punishment is revealing. God replaces the Earth’s then-common language with multiple tongues. The costs of that original sin are still being felt. Today, there are nearly 7000 languages spoken globally across fewer than 300 nation states. Linguistic diversity has of course cultural benefits. But this comes at some considerable economic cost. A common language has been found to increase dramatically bilateral trade between countries, by more than 40%.2 It has been found to increase bilateral investment between two countries by a factor of three or more.3 In Iceland at the start of the century as much as 3% of annual GDP was, quite literally, lost in translation.4 Finance today faces a similar dilemma. It, too, has no common language for communicating financial information. Most financial firms have competing in-house languages, with information systems silo-ed by business line.
At the end of discussions, the Supervisory Council decided to keep the key interest rate unchanged, at 3.75%. The outlook of economic and financial developments inside and outside Albania establishes the continuation of an accommodating monetary conditions cycle over the monetary policy-relevant horizon. This policy establishes the proper conditions to meet the inflation target in the medium-term period, contributing at the same time to the growth of aggregate demand and full utilisation of production capacities in the economy. In its meeting today, the Supervisory Council decided to amend some regulations relating to banking system activity. These amendments strengthen the monetary policy transmission mechanism and establish better conditions to boost lending. They harmonize well with the easing monetary policy and help stimulate economic activity in Albania. More specifically, the approved amendments increase the level of liquidity allowed for banks' use and provide the banking system with greater room to use the financial leverage. Both these initiatives provide a direct impact on a faster growth of lending to the economy. 2  BIS central bankers’ speeches