5  All speeches are available online at www.bankofengland.co.uk/publications/Pages/speeches/default.aspx  5  Informed by these findings, the PRA will soon publish its final Supervisory Statement for banks, insurers and investment firms.10 This statement will set out the PRA’s expectations regarding firms’ approaches to managing the financial risks from climate change, including with respect to:   Governance, where firms will be expected to embed fully the consideration of climate risks into governance frameworks, including at board level, and assign responsibility for oversight of these risks to specific senior role holders;    Risk management, where firms will need to consider climate change in line with their boardapproved risk appetites;    The regular use of scenario analysis to test strategic resilience; and    Developing and maintaining an appropriate disclosure of climate risks. Recognising the need for industry to build capacity and to develop best practices, the PRA has established a Climate Financial Risk Forum, jointly with the FCA, to work with firms from across the financial system.11 The responses to our supervisory consultation reflect the urgency and significance of the issues. Perhaps for the first time in financial regulation, firms are both thanking their supervisors for raising an issue and pushing us to go further; with some asking for more prescriptive recommendations and others for mandatory disclosures.12 Certainly, while climate risk management is improving, there is more to do particularly when assessing strategic resilience. For companies, that means conducting scenario analysis.
In December last year, the People’s Bank of China and the Bank of Thailand concluded the bilateral local currency swap arrangements during the visit of Vice President Xi Jinping to Thailand. The Agreement provides for the exchange of respective local currency upto 70 billion yuan or 320 billion baht, to facilitate bilateral trade and investment. I believe this is a crucial role that the public sector can provide to give assurance to the private sector on the availability of their access to the yuan and the baht for their trade and investment needs. In addition, the Bank of Thailand received approval from the People’s Bank of China and China Securities Regulatory Commission to participate in the interbank bond market and securities market here in China. Our investment would allow our asset allocation and diversification to better reflect the increasingly important role of the yuan in international monetary system. Last but not least, I hope that the inauguration of our Beijing representative office will be more than just another success story. I truly hope that the spirit and friendship behind this long-standing relations and successes, nurtured earnestly over centuries, will continue to serve as solid foundations that will lead to even greater and closer future cooperation between our two nations. Let me end by thanking everyone for being an important part of this success. And, with Your Royal Highness’ permission, may I propose a toast to future success and cooperation as well as to your Royal Highness’s good health and prosperity. Thank you.