The Special Feature Settlement Risk

Mark Carney: I think you're referring to the settlement risk, a special feature. Am I right? Yes. Well, here we're talking about counterparty risk. In particular, there's a very famous historical example of Bank Hurstadt in the 1970s that was motivation for setting up Basel Committee on banking supervision. So it's more of the settlement risk where two transactions belong together as a set of connected transactions. But for technical reasons, perhaps due to some glitch in the infrastructure or there's some default along the way, you don't actually see your side of that transaction. And so those institutions are still yet to be fully developed for many emerging market currencies.