Benchmarking
Currency Benchmarks 2020 – presentation
Central Banking’s currency subject specialist Rachael King speaks with Christopher Jeffery about the future of cash, the relationship between substrates and counterfeits, and how central banks are making their cash operations more sustainable through…
Video Q&A: Andrew Geggus, BNP Paribas
Central Banking met with Andrew Geggus, global head of agency lending trading at BNP Paribas, to discuss what the bank has seen from the central banking community in response to the Covid-19 crisis, and how this has impacted the securities lending…
Currency Benchmarks 2020 report – the data behind the cash cycle
Perspectives on staffing, circulation, forecasting, fraud, substrate choice, outsourcing and climate risk
Big variation in shortest- and longest-lived banknotes
Average lifespans range from 0.6 years to 20 years, with number of denominations playing key role
Asia issues the most banknotes by volume and value
Asian central banks issue 62.3 banknotes worth $1,852 per person
Most central banks not measuring banknote carbon footprint
Very few institutions have cash climate strategy but over 50% are recycling their unfit banknotes
G+D and CPS are ‘most approved’ for banknote sorting
Just over half of survey sample endorses Munich-based manufacturer
Websites are top currency communication tool
More than two thirds of currency managers use social media; regional disparities emerge on preferred communication tools
Printing is the most outsourced area of the cash cycle
Just over 60% of survey respondents contract out currency printing; lower-income countries most likely to outsource
Only 25% of central banks operate own printworks
Larger central banks from high income countries are more likely to print notes in-house
Central banks show wide variation in cash department staffing
Different staffing levels driven in part by which institutions run their own printworks
‘Wear and tear’ the main reason for banknote exchange
Covid-19 raised fears of banknote contamination, but historical exchange is mostly due to worn notes
Reserve Benchmarks 2020 – presentation
Central Banking’s reserves subject matter specialist Victor Mendez-Barreira speaks with Chris Jeffery about tranching trends, euro stutters, climate and ESG, external managers, liquidity stress tests and coverage ratios
Counterfeits rise with issuance on multiple substrates
Average percentage of counterfeits per total volume in circulation is around 0.01%
Reserve Benchmarks 2020 report – charting new data frontiers
Perspectives on staffing and salaries, reserve coverage, portfolio construction, benchmarking, use of external parties and risk management
Spread gap between green and grey bonds closing – BIS specialist
Measuring and incorporating sustainability still a challenge, says Omar Zulaica
One third of reserves staff work in front-office roles
Average reserve management team size is less than 30 employees
Boards are the main authority for benchmark approvals
Risk management teams tend to lead effort to propose new benchmarks
EM reserves ‘crucial’ in mitigating Covid-19 outflows, says Mauritius governor
Foreign exchange buffers helped to mitigate volatility in financial markets
Lower-income countries generate highest reserves growth
Most reserves portfolios appear to have weathered the Covid-19 crisis well
Few central banks consider climate risk within benchmarks
Despite central banks supporting mandatory climate risk disclosures, very few account for it in their benchmarks
Half of reserve managers use bespoke index benchmarks
Those using external managers can choose bespoke, but public indexes remain predominant
Euro failing to challenge US dollar in global reserves – CBI Benchmarks data
Among non-European central banks euro sovereign debt accounts for just 4.1% of reserves; negative rates act as a major barrier, say reserve managers