Failure in this task will additionally give rise to substantial operational and reputation risk, particularly for the banks that have only recently become eligible under CEPA to set up branches on the Mainland. So far, the medium-sized banks seeking to benefit under CEPA are doing so primarily to follow their customers into Mainland China. This simple business model should not pose too much risk for the banks concerned. But banks that are contemplating more aggressive expansion plans, such as tapping the local consumer market, will need at least to be aware of the risks involved and be in a position to manage them prudently. There is a more general and important aspect about this process of growing banking relationship between the Mainland and Hong Kong. This process is likely to be characterised by policy shifts that are more frequent than any other banking environment that we are familiar with. These policy shifts mostly in the Mainland rather than in Hong Kong, and in monetary as well as regulatory policies - are an inevitable feature of a monetary and financial system that is going through reform and liberalisation. And in the absence of deep and sophisticated financial markets in the Mainland to provide the signals and instruments, the task of risk identification and management associated with the more frequent than normal policy shifts is, to put it mildly, a difficult one. An ability to understand, closely monitor and anticipate monetary and financial market developments in the Mainland is therefore crucial, for banks and for us as supervisor.
Bwalya K E Ng’andu: Workshop on Zambian banknotes Opening remarks by Dr Bwalya K E Ng’andu, Deputy Governor (Operations) of the Bank of Zambia, at the G&D Workshop on Zambian banknotes, Lusaka, 22 November 2011. *  *  *    Mr. Werner Reisch and all resource persons from Giesecke and Devrient GmbH    Acting Director – Banking, Currency and Payment Systems    Ladies and Gentlemen  I wish to welcome you all to this workshop on Zambian banknotes and in particular allow me to welcome Mr. Werner Reisch and his team from Germany. As Bank of Zambia, we appreciate your efforts to organise this workshop and would like to assure you that by the end of the workshop all participants will have been enriched with new information on cash management. I am reliably informed that this workshop will be divided into two sessions, with this session targeting employees from Bank of Zambia and the next session that will take place tomorrow targeting commercial bank employees. Ladies and Gentlemen, As you may be aware G&D is a reputable printing company based in Germany which has been in existence since 1852. The Bank has a long standing business relationship with G&D going as far back as 1996 when the company first installed the ISS 300 money counting machines in our Currency office and subsequently the BDS 400 banknote destruction system in 2000.