In the past year, however, house price inflation has been higher than implied by these factors. A large share of the increase in 2006 cannot be explained by previous patterns. Developments since the beginning of the 1990s may have engendered expectations that house prices will only continue to rise. This may increase house purchases for pure investment purposes and induce younger buyers to enter the housing market earlier than otherwise. The pronounced fall in saving indicates that households are taking greater chances. BIS Review 15/2007  11  The housing market may now be in a state of euphoria. After a long period of rising house prices, it may therefore be of interest to look at periods of falling prices. Earlier periods of decline have not lasted very long. Generally, the increase has been stronger than the ensuing fall. There are nevertheless examples of periods where house prices exhibited a continuous fall of up to 50 per cent. Earlier periods of declining house prices probably do not provide a perfect guide. The two most wellknown episodes are the fall in house prices around 1990 and the housing market collapse in Christiania (now Oslo) around 1900. The fall in house prices 15-20 years ago was probably ascribable to the very high real interest rates required to tame inflation and stabilise the exchange rate following two decades of very high inflation. This is not a challenge we are facing today.
Dynamic leadership  Your role in Investrust Bank Plc is very crucial. As the Management team, you are providing leadership. Your way of doing things must be exemplary, inspirational, and analytical, with drive and with integrity. Keep abreast with current affairs. As Financial Intermediaries in the economy, the public looks up to you for innovative and effective products. 2. Customer focus  The Bank of Zambia is keen to see that the Zambian public is offered quality service by the Banking industry. We wish to see more innovative products introduced on the market. I am glad to note that Investrust Bank Plc is part of some banks who teamed up under ZAMLINK to offer ATM services to their clients. Such collaboration is commended. It is in the same spirit that you have supported the RTGS and DDACC products. I will be pleased to learn that this conference will deliberate and resolve on how best the Bank will improve service delivery to greater heights. You need to develop financial products that reflect the country’s level of development and not just ape what is being done in developed countries. 3. Sound practices  In recent years, we have read of how “big” institutions have been brought down due to unprofessional conduct by their senior executives. I urge Investrust Bank Plc to pro-actively propagate Corporate governance standards at all levels of Management. I commend the Bank for the newly created dedicated function of Risk Management in its structure. This will provide prudential guidance in the other areas of operations.