Central Bank Governance and the Role ofDRM to Managing Emerging Markets

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1 Hosted by for Central Banks - Sovereign Investors - State Pension Funds - Treasuries October, 2015, Johannesburg Rethinking investment strategies and portfolio construction as monetary policies diverge Complimentary attendance for central banks and official institutions Speakers include: Keynote speaker: Daniel Mminele Deputy Governor South African Reserve Bank Solomon Kavuma Deputy Director Reserves and Investment Management Operation Bank of Uganda Stephen Opata Head of Risk, Treasury Department Bank of Ghana Presentation sponsors: Associate sponsors: Co-sponsor:

2 Welcome Dear Delegate, So far 2015 has been characterised by slow growth and global uncertainty. Adding to the turmoil is the potential backlash from the near-grexit and the impact it could have on the euro as its share of reserves continue to decline. In order to curb contagion, central banks around the globe are continuing to slash rates going further into negative territory and leaving investors wondering where the new lower bound will be. Even the People s Bank of China couldn t avoid a cut as it was forced to take a rare step and cut both its benchmark interest rates and reserve ratio requirements for the first time since the height of the financial crisis. In what some call quantitative easing with Chinese characteristics, the PBoC has lent to the China Securities Finance Corp to fund stock purchases leaving many worried about the exit and the market turmoil it would cause. The US recovery seems to be steaming ahead, but as global growth continues to stagger, including in China, its recovery is still fragile. This, coupled with risks from Russia/Ukraine, Greece and the Middle East, could force the States to postpone a rate hike until This presents a series of interlocking problems for sovereign investors, challenged as they are to improve returns on their portfolios. Increasingly, they are asking themselves what a global slowdown will mean for their economies. Other questions soon crowd in. How can they better prepare themselves for a US rate hike whilst balancing this with negative yields in Europe? How will regional economies cope with further slides in the price of oil and falling demand from China? How should they position balance sheets to prepare? Now in its 6th year, Nalm Africa provides practitioners with a closed forum to discuss these issues with peers. Today, official sector investors recognise the benefits of these events in sharing experiences to explore answers: to date, more than 1,000 delegates from over 100 countries have participated in Central Banking s Nalm series. This year, we are delighted to welcome Daniel Mminele, Deputy Governor of the South African Reserve Bank. In his keynote address Mr Mminele will discuss diverging monetary policies, their effects on emerging markets, and what central banks can do to insulate their economies. Throughout the symposium, sessions will address the challenges facing managers of national balance sheets. Highlights of the programme include: Solomon Kavuma, Deputy Director for Reserves and Investment Management Operations at the Bank of Uganda will speak about an ALM approach for central banks Stephen Opata, Head of Risk, Treasury Department from the Bank of Ghana will join us to discuss interest rate risk and how central banks can reduce their overall exposure A panel drawn from both oil producing and importing countries will discuss the impact of volatile oil prices on reserve management Join us for a day and a half of networking, candid presentations and interactive question and answer sessions. I look forward to welcoming you in October. Best regards Robert Pringle Chairman and Founder Central Banking Publications

3 Keynote speaker: Daniel Mminele Deputy Governor South African Reserve Bank Daniel Mminele joined the South African Reserve Bank in 1999 as Assistant to Senior Deputy Governor James Cross, and was appointed Deputy Governor and Executive Director of the SARB on 01 July He was reappointed by President Zuma for a second 5-year-term as Deputy Governor in July Mr Mminele is responsible for the Financial Markets, Legal Services and International Economic Relations and Policy Departments of the SARB. Mr Mminele is a member of the Governors Executive Committee, the Monetary Policy Committee, Financial Stability Committee and the Risk Management Committee of the SARB. He is chairperson of the Reserves Management Committee, and also serves as the chairperson of the board of directors of the Corporation for Public Deposits (CPD), a subsidiary of the Bank. Mr Mminele is the G20 central bank deputy for South Africa. His experience before joining the South African Reserve Bank covered credit risk analysis, corporate banking, project and structured finance at private banking institutions in Germany, the United Kingdom and South Africa. Speakers include: Chairperson: Jennifer Johnson-Calari Advisor and Former Director of Sovereign Investment Partnerships The World Bank William Matambo Head of Strategy and Risk Reserve Bank of Malawi Stephen Opata Head of Risk Treasury Department Bank of Ghana Mzi Njamela, Lead Business Research Specialist South African Reserve Bank Solomon Kavuma Deputy Director Reserves and Investment Management Operations Bank of Uganda Yüksel Görmez Senior Economist Central Bank of the Republic of Turkey It was a very resourceful conference that exposed participants to a more efficient and effective approach to managing their national assets Anthony Ikem It was a very informative conference, covering diverse topics in asset allocation and reserves management Simphiwe Maphumulo

4 Day one: Thursday 29 October, 2015 Navigating macroeconomic challenges during times of global volatility Registration and breakfast Chairperson s opening remarks Keynote address: Diverging monetary policies and their effect on emerging markets How will divergence in monetary policy affect asset markets and global liquidity? How will this impact central banks ability to affect their inflation targets? Has divergence in monetary policy impacted investment strategies in emerging markets? How should central banks position their balance sheets to prepare for further divergence? Presentation: The outlook for the US and China and what it means for Africa What does a stronger dollar mean for African economies? How will exchange rates be affected by a rate hike in the US and what can be done to protect currencies? What affect will a slowdown in China have on African economies? Networking break Presentation: Increasing return in a time of negative yields Will yields continue to depreciate? Where is the new lower bound? Will appetite for European bonds dissipate? What effect has the announcement of QE had on appetite for European bonds? Managing the reputational risk of communicating negative yields to the public and stakeholders Panel: Beyond Brics and Mints: Weighing the risk of emerging markets After a year of volatility, what is the outlook for emerging markets? Is the speed of emerging market growth sustainable for the foreseeable future? Opportunities in emerging markets - where can we go? How to manage the risks of investing in emerging markets Presentation: Changing roles for foreign exchange reserves Is the purpose for holding reserves changing? Does this have implications for calculations of reserves adequacy? Are there consequent implications for asset allocation? Lunch New opportunities for asset allocation Presentation: Updating strategic asset allocation: SARB s experience Reasoning behind the investment overhaul Tranching reserves in liquidity and investment tranches What benchmarks were introduced? What were the challenges of updating SAA? Presentation: Securities lending: A useful tool or an unnecessary risk? Using securities lending to promote bond market liquidity What are the lending channels that can be used? What risks are involved with securities lending? Ensuring transparency with clearing houses who has your securities? Networking break Panel: Currency diversification in practice What currencies have been included in the portfolio? How to determine the appropriate allocations for each currency How to gain exposure - directly or through an external manager? What characteristics would a currency need to have in order to be considered in the future? Panel: How are volatile oil prices impacting reserve management? What factors are characterizing the petroleum market? How can central banks in oil exporting countries protect their currencies as oil prices tumble? What can reserve managers to do buffer against further volatility? Chairperson s closing remarks Reception and end of day one Welcome dinner

5 Day two: Friday 30 October, 2015 Rethinking portfolio management Registration and breakfast Chairperson s opening remarks Presentation: The impact of evolving mandates on central bank governance How are governance structures changing as the role of central banks evolve? How should information flow between departments? The importance of transparency in the decision making process Presentation: An ALM approach: Ensuring suitable levels of reserves to meet changing liabilities Overview of asset liability management Determining which liabilities should be included Portfolio management and asset liability strategies The tactical asset liability management approach How to overcome governance hurdles Presentation: More than returns: building relationships with your external managers Process for selecting (and deselecting) external managers - how to ensure your institution is getting the best service for its needs Setting benchmarks with external managers to ensure clear end goals Assessing your manager s qualitative and quantitative performance How to get more from your external manager Networking break Presentation: Managing interest rate risk in times of divergent monetary policies Is there a new equilibrium level for interest rates? Should central banks rethink how they implement monetary policy to limit exposure? How can central banks reduce their overall interest rate risk exposure? Under what conditions should central banks take more interest rate risk? Panel: What risks should sovereign investors be preparing for? What risks are on the horizon? How are geopolitical risks impacting investment decisions? What risks does slow global growth bring? How can central banks determine the optimal risk balance? Chairperson s closing remarks Lunch and close of conference Previous attendees include: African Development Bank Bank of Albania Bank of Algeria Bank of Canada Bank of England Bank of Finland Bank of Ghana Bank of Italy Bank of Korea Bank of Mauritius Bank of Tanzania Bank of Uganda Bank of Zambia Central Bank of Brazil Bank of Mozambique Central Bank of the Republic of China (Taiwan) Central Bank of Colombia Central Bank of Egypt Central Bank of Hungary Central Bank of Ireland Central Bank of Jordan Central Bank of Lesotho Central Bank of Mexico Central Bank of Nigeria Central Bank of Swaziland Central Bank of the Republic of Kosovo Czech National Bank Debt Management Office (Nigeria) Deutsche Bundesbank Development Bank of South Africa Ministry of Finance Malawi Monetary Authority of Singapore National Bank of Angola National Bank of Belgium National Bank of Denmark National Bank of Poland National Bank of the Republic of Macedonia National Bank of Rwanda National Bank of Ukraine Norges Bank Saudi Arabian Monetary Agency South African Reserve Bank Sveriges Riksbank Swiss National Bank The State Pension Fund (Finland) The National Treasury (South Africa)

6 Sponsors Presentation sponsors: Goldman Sachs Asset Management is one of the world s leading investment managers. With more than 2,000 professionals across 33 offices worldwide, GSAM provides institutional and individual investors with investment and advisory solutions, with strategies spanning asset classes, industries and geographies. Our investment solutions include fixed income, money markets, public equity, commodities, hedge funds, private equity and real estate. Our clients access these solutions through our proprietary strategies, strategic partnerships and our open architecture programs. Our investment teams represent over 700 investment professionals, capitalizing on the market insights, risk management expertise and technology of Goldman Sachs. We help our clients navigate today s dynamic markets and identify the opportunities that shape their portfolios and long-term investment goals. We extend these global capabilities to the world s leading pension plans, sovereign wealth funds, central banks, insurance companies, financial institutions, endowments, foundations, individuals and family offices, for whom we invest or advise on more than $1 trillion of assets1. goldmansachs.com BNP Paribas has a presence in 75 countries with more than 180,000 employees, including more than 140,000 in Europe. It ranks highly in its three core activities: Retail Banking, Investment Solutions and Corporate & Investment Banking. In Europe, the Group has four domestic markets (Belgium, France, Italy and Luxembourg) and BNP Paribas Personal Finance is the leader in consumer lending. BNP Paribas is rolling out its integrated retail banking model across Mediterranean basin countries, in Turkey, in Eastern Europe and a large network in the western part of the United States. In its Corporate & Investment Banking and Investment Solutions activities, BNP Paribas also enjoys top positions in Europe, a strong presence in the Americas and solid and fast-growing businesses in Asia-Pacific. BNP Paribas Investment Partners managed USD 662 billion in assets under management as of 31 December We offer multi-asset solutions, fixed income and equity capabilities, have 700 investment professionals and are located in 36 countries. Today we manage USD 57 billion in assets for 54 official institutions clients. Key to our offering for our official institution client base is BNP Paribas Investment Partners Investment Academy which since inception has provided training for over 6,500 participants at more than 350 events in 35 locations and 10 different languages. bnpparibas.com Wellington Management is an independent investment adviser to more than 2,100 institutions in over 50 countries. We have over 25 years of experience managing assets for Central Banks, Government Agencies and Sovereign Institutions across the globe. With US $914 billion in client assets under management, we offer a broad range of equity, fixed income and alternative investment approaches. We also understand the risk management concerns and technology transfer needs of our sovereign clients and work closely with them to share our knowledge and expertise. Wellington has offices in London, Frankfurt, Zurich, Singapore, Hong Kong, Beijing, Sydney, Tokyo, San Francisco, Chicago, Philadelphia and Boston. wellington.com Co-sponsors: Bank of China (Hong Kong) Limited ( BOCHK ) is a leading listed commercial banking group and one of the three bank note issuing banks in Hong Kong. With 97 years of service in Hong Kong, it has been offering comprehensive financial products to personal and corporate customers as well as financial institutions through its extensive distribution network. BOCHK is named the Strongest Bank 2014 in Asia Pacific and Hong Kong by Asian Banker in recognition of its financial strength. As the Hong Kong RMB Clearing Bank, BOCHK has the largest clearing volume among offshore RMB clearing platforms. Its RMB clearing system also offers the world s longest operating hours. BOCHK has pioneered numerous innovative RMB products which have earned it various awards. Possessing a strong team of professionals with comprehensive RMB services, coupled with the close collaboration with Bank of China in the Mainland of China and its extensive network worldwide, BOCHK is the best choice for all RMB needs of customers globally. bochk.com

7 Sponsors Associate sponsors: Baring Asset Management Limited part of the Massachusetts Mutual Life Insurance Company (MassMutual). MassMutual is a leading mutual life insurance company run for the benefit of its members and participating policy owners. The company has a long history of financial strength and strong performance. MassMutual and its subsidiaries had more than $639 billion in assets under management at 31 December Gary Smith is Head of Sovereign Wealth Funds and Official Institutions at Baring Asset Management. He works across the asset management companies of the MassMutual Financial Group: Barings, Babson Capital Management and OFI Global Asset Management. barings.com Few investment management groups have matched the success of Franklin Resources, Inc.(NYSE:BEN), which operates as Franklin Templeton Investments. With over 60 years of investment experience, the company has become recognised as a leader for its global growth and value stock investments and innovative fixed income products under the Franklin, Templeton, Mutual Series. It is one of the world s largest fund managers with offices in over 30 countries and assets over $670.7 billion under management. Franklin Templeton manages and advises on US$90 billion in official sector assets. franklintempleton.co.uk Neuberger Berman is an independent, employee-controlled global asset management company. Founded in 1939 by renowned investor Roy Neuberger, the company today manages $214 billion in assets (as at 30 June 2013). We serve the financial needs of institutions and intermediaries, providing a broad range of investment solutions through customised separately managed accounts and UCITS funds. The company s investment capabilities include equities, fixed income, emerging markets and alternative investment strategies. We are a global business with 30 offices in 16 countries across Europe, the Americas, Asia and the Middle East. Our group headquarters are located in New York, with regional offices in London and Tokyo. With more than 1900 professionals, Neuberger Berman is dedicated to original and fundamental research with an investment culture of independent thinking. nb.com

8 Booking form Register Now: W: nationalalm.com/africa E: T: +44 (0) / +44 (0) F: +44 (0) title first name last name job title/position department company address city post/zip code country telephone fax I intend to attend the NALM Africa dinner taking place on the evening of day one, (29th October). There is no registration fee for delegates from central banks, financial regulatory agencies, ministries of finance, sovereign investment authorities, national treasuries, state pensions funds and government debt management offices. Venue and Accomodation Radisson Blu Gautrain Hotel, Sandton Johannesburg Cnr Rivonia Road and West Street, Benmore 2010, Johannesburg, South Africa Incisive Financial Publishing Ltd. VAT No: GB For companies in EU member states only: Please write your VAT/TVA/BTW/IVA/ MCMS/MWST/FPA number here Register now by Fax: +44 (0) Terms and conditions: No registration fee applies to delegates from central banks, financial regulatory agencies, national treasuries, national pensions, and social security funds, ministries of finance, debt management offices, sovereign wealth funds and investment authorities. Cancellation: For cancellations received less than two weeks before the event start date and in the event that the delegate does not turn up at the event without prior notification, a penalty fee of 499 will be applied. A substitute delegate is welcome but the organiser MUST be notified in advance of the conference to avoid incurring a charge. Substitutions may NOT be made at the conference. Disclaimer: The programme may change due to unforeseen circumstances, and Incisive Media reserves the right to alter the venue and/or speakers. Incisive Media accepts no responsibility for any loss or damage to property belonging to, nor for any personal injury incurred by, attendees at our conferences, whether within the conference venue or otherwise. Data Protection: By registering for the National Asset-Liability Management, Incisive Media will send you further information relating to this event. In addition we will send you information about our other relevant products and services which we believe will be of interest to you. If you do not wish to receive other relevant information from Incisive Media via a particular medium please tick the following relevant boxes: mail phone fax . Incisive Media will also allow carefully selected third parties to contact you about their products and services. If you do not wish to receive information from third parties via any of the following media please tick the relevant boxes: mail phone Please tick if you are happy to receive relevant information from carefully selected third parties by and fax. Registered Office Haymarket House, Haymarket, London SW1Y 4RX UK. Registered in England and Wales number VAT No. GB P. I agree to the Terms and Conditions.