3  All speeches are available online at www.bankofengland.co.uk/speeches  3  But before you all rush to sign up as central bank Chief Risk Officers, free forever from the headaches of commercial capital management, a word of caution. Central banks cannot create money willy-nilly without imperilling inflation, undermining their own monetary stability goals. They typically only lend large amounts on a secured basis – so their lending is limited by the supply of collateral available in the private sector. And, perhaps most profoundly of all, weakly capitalised central banks may find it hard to convince markets that they retain the ability to pursue their broader policy objectives without potentially costly recourse to fiscal resources, or further currency debasement. These limits on central bank balance sheet expansion – 1  sometimes referred to as ‘policy solvency’ constraints – can be every bit as binding as financial solvency requirements. Recent developments in the Bank of England’s own financial risks Despite central bankers’ readiness to enter burning buildings, and the lack of a binding financial solvency constraint, the Bank of England’s balance sheet was actually very modestly sized in the decades leading up the financial crisis, at less than 5% of UK GDP (Chart 2). The Bank did provide emergency assistance in the 2  mid-1980s and early 1990s , but (by recent standards at least) those exposures were small and short-lived. Other than that, the Bank primarily held high quality, low-duration assets to back a relatively stable stock of sterling banknotes and commercial bank reserves.
•  RMB deposits grew more than 20% year-on year. •  Average daily RMB FX turnover grew more than two times in 2014. RMB is now one of top 5 most actively traded currencies in Singapore. •  Aim in coming years is to: o  Grow RMB capital market activities, including through promoting RMB bond issuance;  o  Enhance RMB asset management capabilities, leveraging on RQFII; and  o  Promote cross-border RMB financing, building on RMB pilot for Suzhou Industrial Park and Tianjin Eco-city. Making concerted efforts in two areas that cut across asset classes: skills and technology. 63. First, SkillsFuture. •  We want to be a financial centre that is among leaders globally in workforce skills and expertise, with a strong core of Singaporeans at every level. BIS central bankers’ speeches  9  •  MAS in partnership with industry and educational and training institutes, will undertake initiatives to strengthen support for finance professionals to: o  o o  learn continuously, develop expertise, and make strong contributions throughout their professional careers. 64. Second, Smart Financial Centre. •  We want to be a financial centre where innovation is pervasive and technology is used effectively to: o o  o  o •  10  increase efficiency, create new opportunities, manage risks better, and improve people’s lives. MAS in partnership with industry will drive initiatives to create a vibrant ecosystem for innovation and adoption of new technologies while fostering safety and security. BIS central bankers’ speeches