The payment statistics collected by the National Bank of Belgium harbour a wealth of information which, as a central bank, allows it to map the payments landscape with surprising clarity. Which means of payment do Belgians use most often and which trends are on the rise?
The default risk of Belgium government on its debt is currently low but concerns arise as Fitch downgrades Belgium’s credit rating from stable to negative.
The concept of linking debt payments to changes in GDP became popular again during the debt crisis of the 1980s and gained even more attention during the COVID-19 pandemic. The utilized research suggests that the benefits of this idea depend on how it is implemented and are greatest when payments are directly linked to changes in GDP.
Past experience with GDP-linked bonds, particularly the failure of Argentina's experiment and the success of Portugal's engineering with these financial assets, suggests that the design of the contract is key.
By using an optimized indexed debt approach, default risk can be eliminated, consumption volatility might be halved, and asset prices can rise although government debt balances increase. These changes occur because a carefully chosen indexation method can improve market completion.
Risk management is the exciting core of banking. Correctly identifying and managing risks has been part of the job description for hundreds of years. Correctly pricing the residual risks to economic agents supports the optimal allocation of resources.
Challenges for risk managers within banks, and the broader society, stem from the increased interconnection between risks, the allocation of new risks to bankers and the changing human behavior in our digital society. This has resulted in a substantial growth in risk management tools and risk managers in the 7 lines of defense. In order not to lose focus, we need to keep on investing in the diversity across the 7 lines, in a strong risk & compliance culture and standard operating procedures focused on identifying and managing key risks and controls. This way, through oversight and insight, we are best equipped for current and future risks.
Driven by the goal of creating a more inclusive workplace in the financial sector, Wo.Men in Finance and Nathalie Delaere conducted research on the career obstacles faced by employees in the Belgian financial sector. In spring 2022, they initiated a survey with the objective of identifying the career obstacles experienced by individuals and analyzing whether there is a correlation with corporate culture. This article specifically focuses on the experiences of senior managers, as the survey revealed that 37% of female senior managers and 23% of male senior managers are contemplating leaving their current employers due to issues related to corporate culture, leadership style, and office politics. The following article provides further insights into the main findings.
This article summarises the main findings of the most recent joint update report on asset management and non-bank financial intermediation (NBFI) by the Financial Services and Markets Authority (FSMA) and National Bank of Belgium (NBB), published on 21 December 2022. It is the fourth update of the joint NBB-FSMA report on Asset management and NBFI, formerly referred to as shadow banking, which was submitted to the Minister of Finance and the High-Level Expert Group (HLEG), and subsequently published, in September 2017.
This is the speech given by Johan Thijs, President of Febelfin and CEO of the Belgian banking and insurance group KBC, at this year’s Febelfin Connect event “The Financial sector, a partner for the future” in Brussels on March 29, 2023.
This is the speech given by vice-prime minister and minister of Finance, Vincent Van Peteghem, at this year’s Febelfin Connect event “The Financial sector, a partner for the future” in Brussels on March 29, 2023.
This is the speech given by Febelfin-CEO Karel Baert at this year’s Febelfin Connect event “The Financial sector, a partner for the future” in Brussels on March 29, 2023.
The explosion of prices since the COVID-19 health crisis has significant impacts all around the world. In this contribution, we examine the consequences of the price explosion on the costs of Belgian companies. Four categories of costs are reviewed: the energy costs, the costs of raw materials and industrial inputs, the wage costs and the transport costs. For most of these costs, the increases are higher in Belgium than in the neighbouring countries. We then analyse and estimate the impact of the cost increases on the competitiveness of Belgian companies. According to our estimates, the loss of competitiveness of Belgian companies will be between 3 and 10%. To solve this situation, companies face what we have called an impossible dilemma: increase their selling price or reduce their profitability. However, both solutions will have negative effects on economic growth and employment in Belgium.
The risks a financial institution is facing, are highly dependent on its business model and strategy. Risk management is closely linked with this business model and strategy.
KBC has a clear strategy to be able to adapt to an ever-changing environment. For example, customer behavior is changing more rapidly than ever, with technological advances and digitalization as catalysts. Furthermore, not only the competition but also the pressure from regulators is increasing. The macroeconomic environment also remains particularly challenging, with two human tragedies occurring in quick succession: first Covid-19, then the war in Ukraine.
These structural changes also have an impact on the risk function, which must adapt to remain relevant in this changing environment. We see more and more a shift from traditional financial risks towards non-financial risks (e.g., IT and cyber risks, 3rdparty risks, model risks, anti-money laundering). These risks are not new but have become increasingly important in recent years. In addition, new risks like ESG-risk have emerged, especially in relation to climate change.
Therefore, it is important that risk managers understand the business activities to proactively identify and mitigate risks, whilst being agile to act quickly in case of new challenges.