This is one instructive example of how consumer or investor bodies, such as CASE, can play a useful role bringing together and articulating the common concerns of consumers. The second example is structured deposits. Structured deposits have become a popular new investment instrument providing the chance of higher returns than conventional fixed deposits, in exchange for the risk of lower returns if the bet turns out wrong. However, the calculation of returns and risks on such products may be complex. The average retail investor may not understand what the outcome depends on, much less judge the odds of things working out in his favour. Investors may also be misled by the assumption that, being deposits, such products are very safe. Nevertheless, MAS has not prohibited such structured deposits, because that would restrict investor choices and would benefit neither the industry nor the consumers. But under our disclosure-based philosophy, it is important that consumers understand exactly what they are buying. So MAS has proposed guidelines for full and meaningful disclosure of the risks involved, including reasonable illustrations of potential benefits, and clear explanations of any limits on returns. We have also required banks distributing such products to treat these as investment products rather than deposits which can be sold over-the-counter by bank tellers. These guidelines are currently under consultation. MAS will monitor how the market develops to see if further action is required. Going forward, we will produce educational materials to help consumers understand these products better. VI.
News conference  15 December 2022, 10.00 am  Introductory remarks by Andréa M. Maechler In my remarks, I will talk in more detail about the implementation of today’s monetary policy decision, which Thomas Jordan has already touched on. I will start, however, by giving you an overview of how we have steered interest rates since the switch to a positive SNB policy rate in September. The switch from a negative to a positive SNB policy rate required us to make an adjustment to the implementation of our monetary policy in the money market. The new approach comprises two elements: reserve tiering – that is, tiered remuneration of the sight deposits that banks and other financial market participants hold at the SNB – and reserve absorption. This approach has proved successful. Following our monetary policy decision on 22 September, secured short-term Swiss franc money market rates moved quickly towards the new SNB policy rate (cf. chart 1). We are also continuing to see solid activity among participants in the money market, which ensures a robust basis for the calculation of SARON. From the outset, the market responded favourably to the deployment of our monetary policy instruments to absorb liquidity. On the very day of the monetary policy assessment in September, we started conducting repo transactions on a daily basis and issuing SNB bills on a weekly basis (cf. chart 2). In this way, we were able to reduce the liquidity supply in the money market sufficiently to allow us to steer interest rates effectively.