We will allow greater foreign bank participation in Singapore’s domestic financial system in a way that strengthens financial stability and that encourages foreign banks to deepen their roots in Singapore. MAS will make several refinements to the QFB programme: (i) We will require existing QFBs that are important to the domestic market to locally incorporate their retail operations. The key objective for requiring local incorporation is to strengthen depositor protection. One indicator of importance to the domestic market will be the share of domestic deposits. MAS is also evaluating other factors that may be relevant to individual QFBs and will consult them on the criteria for requiring local incorporation. Not every QFB needs to be locally incorporated. (ii) A very small number of QFBs may become significantly rooted in Singapore over time. For these significantly rooted QFBs, MAS will consider granting an additional 25 places of business, of which up to 10 may be branches, as part of an overall package negotiated with the home countries of these QFBs which are free trade agreement (“FTA”) partners with Singapore. This will bring the total to 50 places of business for such QFBs. Being significantly rooted entails both additional privileges as well as responsibilities to contribute to the stability of the Singapore financial system. 4  BIS central bankers’ speeches  A significantly rooted bank will be determined by both qualitative and quantitative attributes.
Jean-Pierre Roth: What to expect from monetary policy? Summary of a speech by Mr Jean-Pierre Roth, Chairman of the Governing Board of the Swiss National Bank, at the International Center for Monetary and Banking Studies (ICMB), Geneva, 25 November 2003. The complete speech can be found in French on the Swiss National Bank’s website (www.snb.ch). *  *  *  A number of current issues, such as the weakness of the economy and the new National Bank Law, raise the question as to what we can expect from monetary policy. With regard to the stability of consumer prices, the answer is relatively simple. The goal of price stability is at the very top of the Swiss National Bank’s priority list. Since both inflation and deflation are monetary phenomena over the long term, the SNB can and will guarantee price stability in future too. Expectations of monetary policy are considerably lower when it comes to regulating economic activity. Economic activity in Switzerland is strongly dependent on growth abroad. Inflation does not bring about long-term economic growth. Stable prices, however, are the best precondition for sustained growth. A goal of price stability automatically ensures a degree of stability in the economy. Because of uncertainty and time lags, however, fine-tuning the economy is an impossible task. Speculative bubbles in the real estate and equity markets have been an increasing source of macroeconomic instability during the past two decades.