An important point to observe is that the rate for which the FOMC sets a target, the overnight federal funds rate, represents an unsecured lending rate between banks. But the Desk conducted its operations with its primary dealer counterparties – government securities dealers that have an established trading relationship with the New York Fed – in the secured financing market for general collateral repurchase agreements, or GC repos. This market serves as a hub in which broker-dealers and other market participants finance their  3  See my November 27, 2012, Remarks on the Role of Central Bank Interactions with Financial Markets. 4  The Federal Reserve also established a baseline demand for reserves through reserve requirements. Since the expansion of the Federal Reserve’s balance sheet and resultant increase in reserve levels, however, these requirements have been so far below the level of actual reserves that they can be met without any additional Desk actions. 2  BIS central bankers’ speeches  inventories of securities, frequently borrowing from cash-rich investors, such as money market funds. These financing arrangements are structured as repos, in which the security is technically sold with an agreement to repurchase at an agreed-upon later date. The transaction can be thought of in most respects as economically similar to a collateralized loan.
Zeti Akhtar Aziz: The global Islamic financial services industry Speech by Dr Zeti Akhtar Aziz, Governor of the Central Bank of Malaysia, at the Launch of Kuwait Finance House Research, Dubai, 14 May 2007. *  *  *  Let me first of all congratulate Kuwait Finance House on the establishment of the Kuwait Finance House Research. It is my great pleasure and honour to officiate its launch. The establishment of this research entity is timely to meet the more intense demands of operating in a dynamic and highly competitive environment where new challenges and opportunities are continuously emerging in this era of globalisation and change. In the recent five years, there has been a rapid evolution and expansion of the global Islamic financial services industry. Islamic finance has now been accepted as a viable and competitive mode of financial intermediation, not only in Muslim countries but also beyond the Muslim world, which offers a wide range of financial products and services to meet the highly differentiated demands of the new economy. The continued progression in the economic and financial landscape has presented many opportunities for new products, services and innovations. With the accelerating pace of financial integration, financial institutions are presented with prospects to expand beyond domestic borders to capture opportunities from regional and global markets. Nevertheless, these opportunities cannot be fully realised without sound research and development efforts. Successful financial services players must leverage on expertise and knowledge to deliver superior products and services.