Norman T L Chan: Three questions on the nature and management of risk Keynote speech by Mr Norman T L Chan, Chief Executive of the Hong Kong Monetary Authority, at the Hong Kong Monetary Authority-Global Association of Risk Professionals (GARP) Global Risk Forum Opening Dinner, Hong Kong, 28 May 2013. *  *  *  Richard (Apostolik), Ladies and Gentlemen, 1. It is my great pleasure to welcome you all to this dinner gathering tonight. I would like to take this opportunity to thank GARP for co-hosting tomorrow’s Global Risk Forum with the Hong Kong Monetary Authority. 2. This is the third in a series of joint fora which GARP have organised with regulators, and follows similar events in New York and London, focusing on risk and risk management from a global perspective in the wake of the Global Financial Crisis. 3. In contrast to the two previous host cities, Hong Kong (and indeed Asia more generally) has been fortunate not to have borne the full brunt of the recent Crisis. But, we have had our own fair share of crises in the past and, speaking as someone who was tasked with tackling aspects of the Asian Financial Crisis in somewhat unconventional ways, I can assure you that we are only “all too well aware” of the severe economic and social disruptions that financial crises can and do cause.
The Basel Committee has done a great deal in upgrading capital and liquidity rules. Under the direction of G20, there is long list of other regulatory reforms, including those dealing with the moral hazard problem arising from “too big to fail” and the risks observed in the OTC derivative markets. Some national authorities have introduced, or plan to introduce, measures that would separate core retail and commercial banking from  BIS central bankers’ speeches  3  investment banking. Although, as I have said, very few people would dispute the need for urgent reforms, there are differences in views on whether the reforms that are underway are indeed adequate or entirely appropriate. 16. I hope that, at tomorrow’s Forum, you will have the opportunity to discuss these and other pertinent issues as we continue seeking to re-evaluate both the nature of risk management and the role of regulation and supervision in the wake of the Global Financial Crisis. Once again let me welcome you all and wish you Bon Appétit! 4  BIS central bankers’ speeches