In addition, money market experts have noted the exercise’s importance in the current environment of promoting market functioning; for example, it reduces the likelihood of pervasive, negative short-term rates trading. Conclusion In the five years since the FOMC has set the target for the federal funds rate at its zero lower bound, the landscape for the implementation of monetary policy has changed. The tools to implement monetary policy have also changed, and I focused here primarily on a possible new overnight, fixed-rate, full-allotment reverse repo facility. Although the current overnight, reverse repo exercise provides us with useful observations that allow us to improve the technical execution of policy, our knowledge is naturally limited by the exercise’s capped nature. Important questions will remain about the broader money market effects of a fully operational facility. Larger policy and implementation questions will also entail whether – and if so how – other tools would be used in conjunction with this facility and IOER, and how the facility might or might not fit into the Federal Reserve’s longer-run policy framework. But while there’s still a lot to learn, the potential addition of an overnight, fixed-rate, full-allotment reverse repo facility offers a promising new technical advance in the Desk’s implementation of monetary policy.
In Turkey the figure is 52 percent, and is slowly but steadily declining. If we look at the concentration issue from another standpoint, using the data for November 1998 and taking into account the total assets of the sector, 65 percent of the Turkish banking system belongs to the top 10 major banks. If we include the 20 foreign banks and branches having a share of 6 percent, and the 14 development and investment banks having a share of 5 percent, it can be seen that 76 percent of the banking system is consistent with 10 big banks, foreign and investment banks. The remaining 24 percent of the sector belongs to 30 banks. Among these banks, there are banks that are leaders in the sector, functioning properly and effectively. However, a limited number of banks have practical problems which are well  BIS Review 31/1999  2  known to us. We know all their problems. We monitor them. The existing banking laws and other elements of the legal framework do not give us full authority to address them actively and efficiently. The problem of the state owned banks is occasioned by the state budget, and its solution involves different issues. Now let me talk about risk management in the Turkish banking sector. From the standpoint of risk management, we do have well-developed methods of risk management and for supervising the risks that we undertake.