www.centralbanking.com/windsor

Since 1999, Central Banking Publications has organised annual residential training courses/seminars which have been attended by more than 4,500 central bankers and supervisors from over 140 countries.

Series Advisor Charles GoodhartProfessor EmeritusLondon School of EconomicsFinancial Markets Group

April 28 – May 1 2015, Cumberland Lodge, Windsor UK

New Developments in Banknote and Currency Management

Course Chairman Antti HeinonenChairman of Banknote Ethics Initiative and Former Director, Banknotes, European Central Bank

Dear Delegate,“Seeing people’s initial reactions to the new banknote designs is a heartening reminder of what an important role currency plays in our lives, and what a sense of pride and heritage our notes evoke”.

Geoff Bascand, Deputy Governor and Head of Operations, Reserve Bank of New Zealand, November 2014

Banknotes remain the element of central banking that most readily engages the public.

Despite advances in payment technologies and the much-vaunted rise of “virtual” currencies, the number of banknotes in circulation continues to increase, year on year.

Currency is here to stay.

Yet, balancing this increasing demand with requirements, such as cost optimisation and the growing trend for stakeholder engagement, requires new technologies, new skillsets and new ways of thinking. And stretches existing resources.

This course, “New Developments in Banknote and Currency Management” is designed to equip central bankers to meet these challenges whilst examining methodological approaches to the common problems faced by central banks.

The four-day programme of interactive roundtable seminars and workshops offers practical examples of currency management, as well as questions of organisation and resourcing the function.

The panel of expert speakers combines practical central banking experience and expertise in the technical aspects as well as views from private sector experts.

All discussions are held in roundtable format to encourage participants to share their experiences and debate the pressing issues in their field.

This format, as more than 4,500 central bankers and regulators can attest, encourages delegates to quiz panellists, raise issues and discuss solutions to the specific challenges they face.

We look forward to welcoming you to Windsor on April 28.

Yours sincerely,

Robert Pringle, ChairmanCentral Banking Publications

The seminar is very useful Dian Karmila, Head of Operational Currency Management, Bank Indonesia

Key sessions focus on:• Banknote series design • Substrate choice and

features• Engaging stakeholders in

anti-counterfeiting• Working effectively with

external suppliers• Increased efficiencies in

sorting and circulation

Key speakers include:• Richard Wall, Head,

Currency Department, Bank of Canada

• Trond Eklund, Director, Cashier’s Department, Norges Bank

• David Andolfatto, Vice President, Federal Reserve Bank of St. Louis

• Georges Chalhoub, Controller, Cash Operations Department, Central Bank of Lebanon

• Barnabas Ferenczi, Director, Giesecke & Devrient and former Director of Cash Logistics, Central Bank of Hungary

Thursday 18 April

Targeting ‘Right’ Practice

New Developments in Banknote and Currency Management

New challenges in the currency life-cycle Antti Heinonen, Chairman of Banknote Ethics Initiative, and former Director, Banknotes, European Central BankThis opening session, led by the chairman, will consider the changing demands facing banknote and currency managers, from new developments in design and production, to circulation and disposal. Particular areas for discussion will include the breadth and depth of private-sector involvement in the banknote life-cycle, trends in substrate choice, features and banknote “life expectancy”, heightened demands for improved productivity and efficiency, and emerging threats from counterfeiters. Delegates will be encouraged to identify specific areas they would like discussion to address during the seminar and the group will look to set the theme for the week.

Currency management: a risk assessment Alex Jarvis, Former General Manager, Printing Works, Sorting and Cash Centres, Bank of EnglandWhat risks do central banks face in currency management? Who identifies these? How are they measured and how are they managed? By its very nature, currency management brings with it potentially high risks. However, the changing nature of the business has created a complex chain with a number of “moving parts”, cutting across different industries, disciplines and an expanding universe of external suppliers. On top of this, currency provision remains the most important touch point for a central bank with its public and therefore plays a key role in the reputation and public perception of the central bank. This session will draw on the experience of the group to draw out the risks facing currency managers and consider how best these can be managed.

Extending banknotes’ average life Vijay Singh Shekhawat, General Manager, Issue Department, Reserve Bank Of IndiaThe longer a note lasts, the more value a central bank will obtain from a given note order. Given the size of the orders, even a small improvement in percentage terms can mean a substantial improvement in the bottom line for the central bank, from printing costs through to environmental impact. Besides the substrate decision, there are other methods central banks can utilise to extend the lifespan of notes such as the improving of security features and water marks, mechanical properties of varnish and printing techniques. This session will examine recent work in the field to extend the average life of notes across different jurisdictions such as improvements to durability and security, with the ensuing discussions highlighting lessons that other central banks can take from this experience. The speaker will also invite delegates to share any issues surrounding the life-span of notes in circulation within their jurisdictions.

Tuesday 28 April

Risks and Challenges across the Banknote Life-Cycle

New Developments in Banknote and Currency Management

About the course chair:Antti Heinonen has been the Chairman of Banknote Ethics Initiative since its inception in spring 2013. The initiative was established to provide ethical business practice. He was the Director, Banknotes at the European Central Bank (ECB) in Frankfurt from 1998 until 2008, the Chairman of the Central Bank Counterfeit Deterrence Group (CBCDG) between 2008 and 2012, and prior to joining the ECB, the chief cashier for the Bank of Finland. He chaired the Banknote Committee (BANCO) of the European System of Central Banks between July 1998 and November 2008 and was also the Chairman of the Eurosystem Cash Changeover Co-ordination Committee, which had the overall responsibility for the co-ordination of the euro cash changeover in 2002. He holds degrees in economics and mathematics from the University of Helsinki.

Wednesday 29 April

Banknotes: from Sourcing to Circulation

Windsor, 2015

Substrate choice: security, acceptability, economy and longevityRichard Wall, Head, Currency Department, Bank of CanadaThe question of what sort of substrate to use is not a new one. This session will take a fresh look at the question, considering the variety of options available. In particular, the speaker will recount the experience of the Bank of Canada which has completed the change of their notes from paper to polymer. Discussion will focus on the calculus involved, and the practicalities and sensitivities, including environmental ones that a central bank should take into consideration.

Banknote series design: security features in focusTrond Eklund, Director, Cashier’s Department, Norges BankFor currency managers, note design brings together the full range of constituencies and stakeholders that they interact with. New designs must win public and political acceptance, and meet durability, machine processing and environmental standards, and importantly incorporate security features. In this session, the speaker will draw on recent work at the Norges Bank through the design of the new banknote series and discussion will focus on the integration of security features in the design of the banknote.

Anti-counterfeiting strategy: strategy and educating stakeholdersJohn Kendall, Manager, Banknote Education Team, Bank of England (invited)Gaining and maintaining public confidence in the currency is a key role of the Bank of England and one which is essential to the proper functioning of the economy. Today, advances in image-reproduction technology and the development of security features are recurring themes in the “arms race” with counterfeiters. In this session, the speaker will discuss the practicalities faced in designing and issuing new notes, touching upon the public consultation launch by the Bank of England and the importance of engaging stakeholders in the art of anti-counterfeiting, with a particular focus on the communication strategy employed for professional cash handlers.

Tendering and procurement from external suppliers: the client’s expectations and needsGeorges Chalhoub, Controller, Cash Operations Department, Central Bank of Lebanon and John Winchcombe, Line of Business Director, De La Rue CurrencyProcurement from external suppliers is expensive, complex and may span several years. Currency managers must weigh up the importance of price against considerations such as time of delivery, quantity of order and quality of product. At the same time, external suppliers must set out clear expectations of their clients’ needs and ensure that the procurement proposal matches their capabilities and ethical requirements. The speakers in this panel session will discuss, from both sides, issues surrounding procurement proposals and general rules for good practice, drawing out lessons for the group.

The automation and industrialisation of central bank cash centres Barnabas Ferenczi, Director, Giesecke & Devrient and former Director of Cash Logistics, Central Bank of Hungary Whether sorting is carried out in-house or outsourced, central banks are under increasing pressure to improve efficiency. Given the increase in cash circulation globally, there is also a greater need for better cash processing and sorting services. In this session the speaker will highlight new developments in the industry including different sorting and inventory monitoring models.

Thank you for the valuable insights gained during the course. It was a very unique and productive learning experience

Ruth C. Gonzaga, Deputy Director, Central Bank of the Philippines

Thursday 30 April

Optimising the Life-Cycle

New Developments in Banknote and Currency Management

Cash circulation and distribution: what to outsource when and how?Trond Eklund, Director, Cashier’s Department, Norges BankThe demand for cash is rising. But so too are the costs of transport and processing. Increasingly, banknote experts in central banks recognise the need to revisit nationwide arrangements for distribution and actively consider, if not precipitate, greater involvement of the private sector. Yet outsourcing brings with it its own risks. This session will look at these important issues drawing on the work of the Norges Bank, which for a number of reasons, including geographical ones, has introduced a number of innovative cash-processing functions, using third-party operators to print, store, process and, uniquely, destroy its notes.

Effectively forecasting the demand for banknotesWorkshop facilitated by Richard Wall and Antti HeinonenEffective strategic management of currency is impossible without accurate forecasts of the demand for banknotes balanced against the current size and shape of already stocked goods. Yet, as banknote experts acknowledge, there is no formula or “silver bullet” that will deliver a result that holds in every jurisdiction at all times. To this end, central banks typically use a combination of sophisticated modelling and trusted “rules of thumb”. This workshop session will pool collective knowledge to draw out the variables which central banks can and do use to determine the volume and the denomination-split in forecasting the demand for banknotes. Topics of discussion will include the involvement of stakeholders, inventory/contingency plans (logistical vs strategic stock) and calculating trend growth.

Large-volume note sorting and processing: a case studyVijay Singh Shekhawat, General Manager, Issue Department, Reserve Bank Of IndiaThe challenges of withdrawing currency from circulation issuance are particularly heightened in large and cash-driven countries and here technology is of key importance. In this session the speaker from Reserve Bank of India (RBI) will discuss with the group the results of experiments his institution conducted in search for appropriate technology for note sorting and processing of large volumes banknotes in circulation. He will also show how the RBI’s system of currency chests, note depositories with note sorting machines, placed within commercial banks, helps with issuance, note sorting and detection of fake banknotes.

Previous attendees includeBank of Algeria • Reserve Bank of Australia • Austrian National Bank • Central Bank of Bahrain • Central Bank of Barbados • Bermuda Monetary Authority • Central Bank of Bosnia & Herzegovina • Central Bank of Brazil • British Virgin Islands Financial Services Commission • Brunei Currency and Monetary Board • Bank of Canada • Central Bank of Colombia • Czech National Bank • National Bank of Denmark • Central Bank of Ecuador • Banque de France • Central Bank of the Gambia • European Central Bank • Bank of Ghana • Central Bank of Honduras • Hong Kong Monetary Authority • Central Bank of Hungary • Reserve Bank of India • Bank Indonesia • Bank of Italy • Bank of Jamaica • Central Bank of Kenya • Bank of Korea • Bank Negara Malaysia • Maldives Monetary Authority • Reserve Bank of New Zealand • Central Bank of Nigeria • Norges Bank • Central Bank of Oman • State Bank of Pakistan • Bank of Papua New Guinea • Central Bank of Paraguay • Central Bank of the Philippines • Central Bank of Qatar • National Bank of Romania • SAMA • Central Bank of Seychelles • Bank of Sierra Leone • Monetary Authority of Singapore • South African Reserve Bank • Bank of Spain • Central Bank of Sri Lanka • Sveriges Riksbank • Swiss National Bank • Bank of Tanzania • Bank of Thailand • Central Bank of the Republic of Turkey • Bank of Uganda • Bank of England • Federal Reserve Bank of New York • Bank of Zambia

Friday 1 May

Future Proofing

Windsor, 2015

Introducing new currencies: the impact of alternative payments meansDavid Andolfatto, Vice President, Federal Reserve Bank of St. Louis Despite an array of predictions to the contrary, cash still remains popular worldwide. Yet the rise of digital and electronic money, most notably Bitcoin in 2013, has shown that technologies do exist which replicate the experience of cash and are acceptable to retailers and the public alike. These digital currencies have one obvious advantage which is their ability to be global. What challenges does this scenario present for central banks? What is the future of cash? With most central banks taking a negative stance to digital currencies the speaker will show how beneficial coexistence can be established by a blend of price-level stability and low-cost payments. The group will also consider policy issues surrounding cash and its competitors.

Contingency planning: what if?Antti Heinonen, Former Director, Banknotes, European Central BankIn 2015, no central bank is unaware of the requirement that all key business areas be included in effective contingency plans. High-profile incidents around the world have highlighted the importance of central banks having in place considered, tested plans to deal with outages occurring due to everything from supplier problems to natural disasters. This session will draw on the experiences of the group in the area of contingency planning and operational risk management. Participants will consider a variety of scenarios around the breakdown or failure of note supply, and will be challenged to think how they would tackle them.

Lessons and key issuesWrap-up discussion and action points led by Antti HeinonenThis session draws together the themes of the course and focuses on key ideas and conclusions. Delegates will reflect on lessons learnt throughout the seminar and identify opportunities for moving forward in their own organisations. The group will review the challenges identified as most pressing and discuss together the most effective possible solutions.

CBP’s Spring Series 2015 features the following seminars:

• Strategic Planning and Change Management for Central Banks Chair: Janet Cosier, former Adviser on Strategic Planning and Risk

Management, Bank of Canada• Financial Stability: Designing and Implementing Macroprudential Policy Chair: E. Philip Davis, Principal Research Fellow, National Institute of

Economic and Social Research, and Associate Professor, Brunel University• Central Bank Governance: the Role of the Board Chair: John Jussup, Former General Counsel and Corporate Secretary, Bank

of Canada• New Developments in Banknote and Currency Management Chair: Antti Heinonen, Chairman of Banknote Ethics Initiative and Former

Director, Banknotes, European Central Bank• Central Bank Statistics: From Data Delivery to Analytical Value Add Chair: Laura Vajanne, Head of Statistics, Bank of Finland• AML/CFT: Implementing a Risk-Based Framework Chair: Richard Chalmers, Former Co-Chair of the FATF’s Evaluation and

Compliance Group• Effective Internal Audit for Central Banks Chair: Paul Apps, Former Head of Audit, Reserve Bank of Australia

Booking details

New Developments in Banknote and Currency Management

Course fee: £3,300 4-Day (3 nights) residential courseCourse fee includes: en-suite accommodation, meals, refreshments, course documentation and a complimentary copy of the most recent issue of the Central Banking journal. Substitute delegates can be accepted should the registered delegate be unable to attend; please let us know prior to the event.

How to bookThere is a booking form overleaf. Please use one of the following methods to book your place:

Online: www.centralbanking.com/windsorCall: Clare Hope on +44 (0) 207 316 9152Email: conference@centralbanking.comFax: Attention of Central Banking Events to +44 (0)207 504 3730Post: Central Banking Publications

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The Venue

The 2015 Spring Series will take place at the Cumberland Lodge, a former royal residence. Set in the tranquil heart of Windsor Great Park, only 27 miles from London and a short distance from Heathrow airport, Cumberland Lodge is perfectly placed for local, national and international meetings. Dining and accommodation are top class and the atmosphere is that of a friendly country house.

About Central Banking Publications

For 25 years Central Banking Publications has been a trusted provider of independent, authoritative and relevant information, commentary and analysis to the central banking community. Central Banking Publications’ events division is the leading independent organiser of public policy seminars/training courses for the official sector. Since 1999, CBP has hosted roundtable seminars and training courses for over 4,500 senior policymakers from central banks, ministries of finance and financial regulatory agencies around the world. Senior officials from more than 140 countries have attended these meetings over the past decade and a half.

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