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Category: Economics

  • MIL-OSI Economics: World Osteoporosis Day highlights need for comprehensive care strategies, says GlobalData

    Source: GlobalData

    World Osteoporosis Day highlights need for comprehensive care strategies, says GlobalData

    Posted in Pharma

    Marking World Osteoporosis Day on 20 October, the International Osteoporosis Foundation (IOF) brought worldwide attention to a crucial issue: the urgent need for robust osteoporosis screening and sustained care strategies to prevent fragility fractures. Under the theme “Say No to Fragile Bones,” it highlighted the gaps in diagnosis and treatment, stressing the importance of proactive approaches and structured care to mitigate rising fracture risks as global populations age, according to GlobalData, a leading data and analytics company.

    Osteoporosis, often termed a “silent disease,” progresses without symptoms until a fracture occurs, making it the primary cause of fragility fractures worldwide. With millions affected globally, osteoporosis results in weakened bone structure and increases fracture risk, particularly in the spine and hip.

    Such fractures lead to extended recovery times, significantly impacting patients’ quality of life and placing strain on healthcare systems. As the global population ages, untreated osteoporosis will exert an even greater burden on health services, underscoring the need for preventive strategies and consistent patient management.

    Sulayman Patel, MSci, Pharma Analyst at GlobalData, comments: “World Osteoporosis Day 2024 pushes both the public and healthcare professionals to prioritize preventive measures. The IOF’s ‘5 Steps to Bone Health’ campaign emphasizes specific actions, including weight-bearing exercises, a nutrient-rich diet, and lifestyle adjustments. However, these guidelines must be coupled with systems that ensure early identification and consistent management of at-risk individuals to be effective.”

    Research from GlobalData and expert interviews reveal significant under-treatment in osteoporosis care. A European key opinion leader (KOL) stated, “We are currently doing very bad, with few patients having osteoporosis that receive treatment. There is a tremendous gap between what should be done and what is currently done.”

    This shortfall is especially pronounced in post-fracture care, where many patients are neither diagnosed nor treated for underlying osteoporosis. These gaps highlight the need for structured follow-up care and comprehensive treatment pathways.

    Patel continues: “This gap presents an opportunity for pharmaceutical and healthcare companies to drive advancements in diagnostic tools. Companies like Siemens Healthineers and ImageBiopsy Lab are already using machine learning technologies to enhance early detection. Wider adoption of these tools could lead to earlier diagnoses, minimizing healthcare costs associated with untreated osteoporosis.

    Amid persistent unmet needs, Amgen’s Evenity addresses a critical gap by simultaneously promoting bone formation and reducing bone resorption, offering a comprehensive approach to fracture prevention.

    Patel concludes: “Moreover, structured programs like Fracture Liaison Services (FLS) are essential for effective osteoporosis management. FLS provides post-fracture patients with critical assessments, medication, and lifestyle support to prevent future fractures. Yet FLS programs remain underutilized, particularly in regions with fragmented healthcare systems. World Osteoporosis Day highlights the need for a coordinated approach to osteoporosis care, spanning diagnosis and ongoing management, to ensure comprehensive support for all patients.”

    MIL OSI Economics –

  • MIL-OSI Economics: Bladder cancer diagnosed incident cases across 8MM to reach 0.34 million in 2033, forecasts GlobalData

    Source: GlobalData

    Bladder cancer diagnosed incident cases across 8MM to reach 0.34 million in 2033, forecasts GlobalData

    Posted in Pharma

    The diagnosed incident cases of bladder cancer in the eight major markets (8MM*) are set to register an annual growth rate (AGR) of 2.24% from 0.28 million in 2023 to 0.34 million in 2033, forecasts GlobalData, a leading data and analytics company.

    GlobalData’s latest report, “Bladder Cancer – Epidemiology Forecast to 2033,” reveals that the US will have the highest number of diagnosed incident cases of bladder cancer among the 8MM at 0.10 million cases, whereas France will have the lowest number at 0.02 million cases in 2033.

    Antara Bhattacharya, Associate Project Manager, Epidemiology team at GlobalData, comments: “In 2023, men are more affected than women with approximately 78% men and 22% women.”

    Older adults in ages 60 years and above accounted for almost 87% of the diagnosed incident cases of bladder cancer in the 8MM in 2023, while younger adults in ages 18–59 years accounted for approximately 13% of the cases.

    GlobalData estimates that in 2023, approximately 45% of the incident cases of bladder cancer were diagnosed in the early stages by AJCC TNM staging, whereas only 6% of cases had a delayed diagnosis. Additionally, approximately 79% of the incident cases by tumor “T” stage at diagnosis were diagnosed in earlier stages, whereas only 4% cases were in severe stages.

    The high rate of diagnosis at earlier stages can be attributed to the success of increasing rates of cystoscopy, which is an invasive and expensive procedure. Approximately 74% of diagnosed prevalent cases of NMIBC relapse or recurred to MIBC.

    Bhattacharya concludes: “Bladder cancer is the ninth most common cancer type, and timely detection of the disease is both challenging and expensive. Diagnosis relies mainly on cystoscopy, which is an invasive procedure and difficult in low-resource settings. Even after being diagnosed in early stages when the disease is highly treatable, the relapse and recurrence rates are high.

    “Hence, adequate research and medical interventions are needed to facilitate different medical approaches for the timely detection and treatment. Epidemiological studies focusing on bladder cancer stages with relapse or recurrence can improve treatment outcomes. Additionally, bladder cancer treatment requires a multifaceted approach that integrates medical and surgical interventions, lifestyle modifications, ongoing support, along with immunotherapy, targeted therapy, clinical trials, and follow-up care.”

    *8MM: The US, 5EU (France, Germany, Italy, Spain, the UK), Japan, and urban China.

    MIL OSI Economics –

  • MIL-OSI Economics: Egypt marks major achievement with malaria-free certification, but need for global R&D remains significant, says GlobalData

    Source: GlobalData

    Egypt marks major achievement with malaria-free certification, but need for global R&D remains significant, says GlobalData

    Posted in Pharma

    The World Health Organization (WHO) has certified Egypt as being malaria-free, following a near 100-year endeavour by the Egyptian government. Egypt is the third country to be declared malaria-free in the WHO Eastern Mediterranean Region, and the 44th country globally. However, hundreds of millions of cases of malaria are still reported worldwide each year. These staggering numbers reinforce a global need for research and development, particularly for malaria vaccines, says GlobalData, a leading data and analytics company.

    Stephanie Kurdach, Infectious Disease Analyst at GlobalData, comments: “Egypt’s malaria-free certification is a significant achievement, as this is a country which once recorded millions of cases. Unfortunately, the global burden of malaria remains high.”

    The WHO reported nearly 250 million cases of malaria and over 600,000 malaria-related deaths worldwide in 2022.

    In order to be certified malaria-free by the WHO, a country must prove that there has been no local transmission of any human malaria parasites for at least the past three consecutive years. Additionally, a country must maintain a fully functional surveillance and response system to prevent the re-establishment of indigenous transmission.

    Egypt’s efforts to reduce mosquito-borne diseases began in the 1920s, when the country prohibited agricultural crops near homes. Other efforts over the past 100 years have included opening a malaria control station, recruiting thousands of healthcare workers, launching a public health surveillance project, and public education.

    Kurdach continues: “To address the global burden of malaria and work towards global eradication, research and development is critical. Just as Egypt remains obligated to maintain surveillance, diagnosis, and treatment efforts throughout the nation, other nations plagued by malaria are in dire need of robust surveillance systems, diagnostic tools, affordable health care, and malaria vaccines.”

    There are currently only two malaria vaccines which are WHO prequalified* and recommended for use in children: GSK’s Mosquirix and Serum Institute of India’s R21/Matrix-M.

    According to GlobalData, there are 12 other malaria vaccines currently in Phase II development, including vaccines from BioNTech, GSK, the National Institute of Allergy and Infectious Diseases (NIAID), and the University of Oxford. No new malaria vaccines are in Phase III development or pre-registration.

    Kurdach concludes: “There is a serious global unmet need for malaria vaccines, which is evidenced by the late-stage development pipeline. Egypt’s malaria-free certification serves as a reminder and call to action that malaria elimination is possible with increased research and development.”

    *The recommendations of Mosquirix and R21/Matrix-M by the WHO are relatively recent and occurred in 2021 and 2023, respectively.

    MIL OSI Economics –

  • MIL-OSI Economics: Diabetes Awareness Month shines light on prevention and treatment options, says GlobalData

    Source: GlobalData

    Diabetes Awareness Month shines light on prevention and treatment options, says GlobalData

    Posted in Medical Devices

    Diabetes Awareness Month, observed every November, is dedicated to raising awareness about diabetes, promoting education, and advocating for improved care and support for those affected by the condition. This month-long campaign seeks to improve public understanding of diabetes, address common misconceptions, and reduce the stigma often associated with the condition. It also provides a platform for people living with diabetes to share their stories, foster community, and encourage advocacy efforts. Diabetes Awareness Month is important, as prevalence is increasing for both Type 1 and Type 2 diabetes, according to GlobalData, a leading data and analytics company.

    Diabetes is a chronic health condition characterized by the body’s inability to properly regulate blood sugar levels. There are three primary types of diabetes: Type 1, Type 2, and Gestational Diabetes. Each type of diabetes presents unique challenges, requiring tailored approaches to management and treatment. During Diabetes Awareness Month, organizations work to educate the public on these differences and the importance of early diagnosis.

    Alexandra Murdoch, Senior Medical Analyst at GlobalData, comments: “Diabetes is a growing global health issue. Increasing awareness around diabetes can lead to earlier diagnoses, better management, and a decrease in related complications such as heart disease, stroke, and kidney failure.”

    According to GlobalData’s pipeline database, diabetes care devices are the leading market by pipeline products, with over 250 active products in the pipeline. These devices include digital therapeutics, continuous glucose monitors, contrast agents for diagnostics, and more. Many of the diabetes care devices in the pipeline database are expected to be approved in 2025, and many more from 2026-2029.

    Early diagnosis and the creation of a treatment plan is crucial when it comes to diabetes, as there are several complications co-occurring conditions associated with diabetes, including vision loss, heart disease, kidney disease, foot ulcers and lower limb amputations. It is possible to reduce the risk of complications through lifestyle management, such as not smoking, being active, controlling blood pressure, eating healthy, and monitoring blood glucose levels.

    Murdoch concludes: “Diabetes Awareness Month plays a critical role in promoting understanding and support for the millions affected by diabetes worldwide. By highlighting the realities of living with diabetes, addressing misconceptions, and emphasizing the importance of early detection and effective management, the campaign makes strides toward reducing the overall impact of diabetes on individuals and society.”

    MIL OSI Economics –

  • MIL-OSI Economics: RBI to conduct Overnight Variable Rate Reverse Repo (VRRR) auction under LAF on October 30, 2024

    Source: Reserve Bank of India

    On a review of the current and evolving liquidity conditions, it has been decided to conduct a Variable Rate Reverse Repo (VRRR) auction on October 30, 2024, Wednesday, as under:

    Sl. No. Notified Amount
    (₹ crore)    		 Tenor
    (day)    		 Window Timing Date of Reversal
    1 75,000 1 11:00 AM to 11:30 AM October 31, 2024
    (Thursday)

    2. The operational guidelines for the auction as given in the Reserve Bank’s Press Release 2019-2020/1947 dated February 13, 2020 will remain the same.

    (Puneet Pancholy)  
    Chief General Manager

    Press Release: 2024-2025/1398

    MIL OSI Economics –

  • MIL-OSI Economics: Suzuki and Toyota to Deepen Collaboration in the Field of Electrified Vehicles

    Source: Toyota

    Headline: Suzuki and Toyota to Deepen Collaboration in the Field of Electrified Vehicles

    Suzuki Motor Corporation (Suzuki) and Toyota Motor Corporation (Toyota) have decided to further strengthen collaboration in the supply of a battery EV (BEV) SUV model developed by Suzuki to Toyota. This new model is scheduled to be manufactured at Suzuki Motor Gujarat in India from the spring of 2025.

    MIL OSI Economics –

  • MIL-OSI Economics: Strong Portfolio and Strategic Priorities Support Phillips 66 Third-Quarter Results

    Source: Phillips

    Reported third-quarter earnings of $346 million or $0.82 per share; adjusted earnings of $859 million or $2.04 per share
    Returned $1.3 billion to shareholders through dividends and share repurchases
    Achieved business transformation $1.4 billion run-rate savings target, including $1 per barrel Refining cost reduction
    Progressed asset dispositions totaling $2.7 billion toward $3 billion target, including recently executed agreements

    HOUSTON–(BUSINESS WIRE)– Phillips 66 (NYSE: PSX), a leading integrated downstream energy provider, announced third-quarter earnings.
    “Our employees continue to execute our strategic priorities, deliver strong operating performance and leverage the benefits of our differentiated downstream portfolio,” said Mark Lashier, chairman and CEO of Phillips 66.
    “We have achieved our cost reduction and Midstream synergy targets,” said Lashier. “In addition, we have significantly advanced our asset disposition program with recently announced transactions. Our commitment to operational excellence and disciplined capital allocation continues to create long-term shareholder value.” 
    Financial Results Summary ( in millions of dollars, except as indicated)

     

     

     

    3Q 2024

    2Q 2024

    Earnings

    $

    346

     

    1,015

     

    Adjusted Earnings 1

     

    859

     

    984

     

    Adjusted EBITDA 1

     

    1,998

     

    2,183

     

    Earnings Per Share

     

     

    Earnings Per Share – Diluted

     

    0.82

     

    2.38

     

    Adjusted Earnings Per Share – Diluted 1

     

    2.04

     

    2.31

     

    Cash Flow From Operations

     

    1,132

     

    2,097

     

    Cash Flow From Operations, Excluding Working Capital 1

     

    1,513

     

    1,181

     

    Capital Expenditures & Investments 2

     

    358

     

    367

     

    Return of Capital to Shareholders

     

    1,277

     

    1,325

     

    Share repurchases

     

    800

     

    840

     

    Dividends paid

     

    477

     

    485

     

    Cash

     

    1,637

     

    2,444

     

    Debt

     

    19,998

     

    19,960

     

    Debt-to-capital ratio

     

    40

    %

    40

    %

    Net debt-to-capital ratio 1

     

    38

    %

    36

    %

    1Represents a non-GAAP financial measure. Reconciliations of these non-GAAP financial measures to the most comparable GAAP financial measure are included within this release.

    2Excludes acquisitions of $567 million in the third quarter of 2024, and purchases of government obligations of $1.1 billion in third-quarter of 2024.

    Segment Financial and Operating Highlights (in millions of dollars, except as indicated)

     

     

     

    3Q 2024

    2Q 2024

    Change

    Earnings 1

    $

    346

     

    1,015

     

    (669

    )

    Midstream

     

    644

     

    767

     

    (123

    )

    Chemicals

     

    342

     

    222

     

    120

     

    Refining

     

    (108

    )

    302

     

    (410

    )

    Marketing and Specialties

     

    (22

    )

    415

     

    (437

    )

    Renewable Fuels

     

    (116

    )

    (55

    )

    (61

    )

    Corporate and Other

     

    (327

    )

    (340

    )

    13

     

    Income tax expense

     

    (44

    )

    (291

    )

    247

     

    Noncontrolling interests

     

    (23

    )

    (5

    )

    (18

    )

     

     

     

     

    Adjusted Earnings 1,2

    $

    859

     

    984

     

    (125

    )

    Midstream

     

    672

     

    753

     

    (81

    )

    Chemicals

     

    342

     

    222

     

    120

     

    Refining

     

    (67

    )

    302

     

    (369

    )

    Marketing and Specialties

     

    583

     

    415

     

    168

     

    Renewable Fuels

     

    (116

    )

    (55

    )

    (61

    )

    Corporate and Other

     

    (327

    )

    (340

    )

    13

     

    Income tax expense

     

    (205

    )

    (278

    )

    73

     

    Noncontrolling interests

     

    (23

    )

    (35

    )

    12

     

     

     

     

     

    Adjusted EBITDA 2

    $

    1,998

     

    2,183

     

    (185

    )

    Midstream

     

    892

     

    971

     

    (79

    )

    Chemicals

     

    466

     

    348

     

    118

     

    Refining

     

    188

     

    531

     

    (343

    )

    Marketing and Specialties

     

    656

     

    484

     

    172

     

    Renewable Fuels

     

    (92

    )

    (43

    )

    (49

    )

    Corporate and Other

     

    (112

    )

    (108

    )

    (4

    )

     

     

     

     

    Operating Highlights

     

     

     

    Midstream NGL Fractionated Volumes (MBD)

     

    728

     

    744

     

    (16

    )

    Chemicals Global O&P Utilization

     

    98

    %

    98

    %

    —

    %

    Refining

     

     

     

    Turnaround Expense ($)

     

    137

     

    100

     

    37

     

    Realized Margin ($/BBL) 2

     

    8.31

     

    10.01

     

    (1.70

    )

    Crude Capacity Utilization

     

    94

    %

    98

    %

    (4

    %)

    Clean Product Yield

     

    87

    %

    86

    %

    1

    %

    Renewable Fuels Produced (MBD)

     

    44

     

    31

     

    13

     

    1Segment reporting is pre-tax.

     

     

     

    2Represents a non-GAAP financial measure. Reconciliations of these non-GAAP financial measures to the most comparable GAAP financial measure are included within this release.

    Third-Quarter 2024 Financial Results
    Reported earnings were $346 million for the third quarter of 2024 versus $1.0 billion in the second quarter. Third-quarter earnings included a legal accrual of $605 million in the Marketing and Specialties segment, costs related to the planned shutdown of the Los Angeles Refinery of $41 million in the Refining segment, and an impairment of $28 million in the Midstream segment. Second-quarter earnings included a gain on sale of investment of $238 million and an impairment of $224 million, both impacting the Midstream segment. Adjusted earnings for the third quarter were $859 million versus $984 million in the second quarter.
    Midstream third-quarter 2024 adjusted pre-tax income decreased compared with the second quarter mainly due to seasonal maintenance costs and lower equity earnings, partially offset by higher export margins.
    Chemicals reported pre-tax income increased mainly due to higher margins and lower costs.
    Refining adjusted pre-tax loss was a decrease compared to the second quarter, primarily due to a decline in realized margins largely driven by lower market crack spreads.
    Marketing and Specialties adjusted pre-tax income increased primarily due to higher margins.
    Renewable Fuels reported pre-tax loss increased primarily due to lower realized margins, partially offset by higher volumes.
    As of September 30, 2024, the company had $1.6 billion of cash and cash equivalents and $5.3 billion of committed capacity available under credit facilities.
    Business Highlights and Strategic Priorities Progress
    Distributed $12.5 billion through share repurchases and dividends since July 2022 and on pace to achieve the company’s $13 billion to $15 billion target by year-end.
    Achieved $1.4 billion in run-rate business transformation savings, delivering on the company’s target ahead of schedule.
    Expanded its Midstream NGL wellhead-to-market business with the acquisition of Pinnacle Midstream and approved a follow-on processing plant expansion in the Midland Basin expected to be completed in mid-year 2025.
    Achieved target of over $400 million of run-rate synergies from the successful integration of DCP Midstream.
    Received proceeds of $1.3 billion since 2022 toward the company’s $3 billion asset disposition target. In addition, the company recently agreed to sell its 49% interest in a Switzerland-based retail joint venture for $1.24 billion, and its interests in non-core Midstream assets in North Dakota.
    Investor Webcast
    Members of Phillips 66 executive management will host a webcast at noon ET to provide an update on the company’s strategic initiatives and discuss the company’s third-quarter performance. To access the webcast and view related presentation materials, go to phillips66.com/investors and click on “Events & Presentations.” For detailed supplemental information, go to phillips66.com/supplemental.
    About Phillips 66
    Phillips 66 (NYSE: PSX) is a leading integrated downstream energy provider that manufactures, transports and markets products that drive the global economy. The company’s portfolio includes Midstream, Chemicals, Refining, Marketing and Specialties, and Renewable Fuels businesses. Headquartered in Houston, Phillips 66 has employees around the globe who are committed to safely and reliably providing energy and improving lives while pursuing a lower-carbon future. For more information, visit phillips66.com or follow @Phillips66Co on LinkedIn.Use of Non-GAAP Financial Information —This news release includes the terms “adjusted earnings,” “adjusted pre-tax income (loss),” “adjusted EBITDA,” “adjusted earnings per share,” “refining realized margin per barrel,” “cash from operations, excluding working capital,” and “net debt-to-capital ratio.” These are non-GAAP financial measures that are included to help facilitate comparisons of operating performance across periods and to help facilitate comparisons with other companies in our industry. Where applicable, these measures exclude items that do not reflect the core operating results of our businesses in the current period or other adjustments to reflect how management analyzes results. Reconciliations of these non-GAAP financial measures to the most comparable GAAP financial measure are included within this release.
    References in the release to earnings refer to net income attributable to Phillips 66. References to run-rate business transformation savings include cost savings and other benefits that will be captured in the sales and other operating revenues impacting gross margin; purchased crude oil and products costs impacting gross margin; operating expenses; selling, general and administrative expenses; and equity in earnings of affiliates lines on our consolidated statement of income when realized. Run-rate savings include run-rate sustaining capital savings. Run-rate sustaining capital savings include savings that will be captured in the capital expenditures and investments on our consolidated statement of cash flows when realized.
    Basis of Presentation — Effective April 1, 2024, we changed the internal financial information reviewed by our chief executive officer to evaluate performance and allocate resources to our operating segments. This included changes in the composition of our operating segments, as well as measurement changes for certain activities between our operating segments. The primary effects of this realignment included establishment of a Renewable Fuels operating segment, which includes renewable fuels activities and assets historically reported in our Refining, Marketing and Specialties (M&S), and Midstream segments; change in method of allocating results for certain Gulf Coast distillate export activities from our M&S segment to our Refining segment; reclassification of certain crude oil and international clean products trading activities between our M&S segment and our Refining segment; and change in reporting of our 16% investment in NOVONIX from our Midstream segment to Corporate and Other. Accordingly, prior period results have been recast for comparability.
    In the third quarter of 2024, we began presenting the line item “Capital expenditures and investments” on our consolidated statement of cash flows exclusive of acquisitions, net of cash acquired. Accordingly, prior period information has been reclassified for comparability.
    Cautionary Statement for the Purposes of the “Safe Harbor” Provisions of the Private Securities Litigation Reform Act of 1995 —This news release contains forward-looking statements within the meaning of the federal securities laws relating to Phillips 66’s operations, strategy and performance. Words such as “anticipated,” “estimated,” “expected,” “planned,” “scheduled,” “targeted,” “believe,” “continue,” “intend,” “will,” “would,” “objective,” “goal,” “project,” “efforts,” “strategies” and similar expressions that convey the prospective nature of events or outcomes generally indicate forward-looking statements. However, the absence of these words does not mean that a statement is not forward-looking. Forward-looking statements included in this news release are based on management’s expectations, estimates and projections as of the date they are made. These statements are not guarantees of future events or performance, and you should not unduly rely on them as they involve certain risks, uncertainties and assumptions that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecast in such forward-looking statements. Factors that could cause actual results or events to differ materially from those described in the forward-looking statements include: changes in governmental policies or laws that relate to our operations, including regulations that seek to limit or restrict refining, marketing and midstream operations or regulate profits, pricing, or taxation of our products or feedstocks, or other regulations that restrict feedstock imports or product exports; our ability to timely obtain or maintain permits necessary for projects; fluctuations in NGL, crude oil, refined petroleum, renewable fuels and natural gas prices, and refining, marketing and petrochemical margins; the effects of any widespread public health crisis and its negative impact on commercial activity and demand for refined petroleum or renewable fuels products; changes to worldwide government policies relating to renewable fuels and greenhouse gas emissions that adversely affect programs including the renewable fuel standards program, low carbon fuel standards and tax credits for renewable fuels; potential liability from pending or future litigation; liability for remedial actions, including removal and reclamation obligations under existing or future environmental regulations; unexpected changes in costs for constructing, modifying or operating our facilities; our ability to successfully complete, or any material delay in the completion of, any asset disposition, acquisition, shutdown or conversion that we have announced or may pursue, including receipt of any necessary regulatory approvals or permits related thereto; unexpected difficulties in manufacturing, refining or transporting our products; the level and success of drilling and production volumes around our midstream assets; risks and uncertainties with respect to the actions of actual or potential competitive suppliers and transporters of refined petroleum products, renewable fuels or specialty products; lack of, or disruptions in, adequate and reliable transportation for our products; failure to complete construction of capital projects on time or within budget; our ability to comply with governmental regulations or make capital expenditures to maintain compliance with laws; limited access to capital or significantly higher cost of capital related to illiquidity or uncertainty in the domestic or international financial markets, which may also impact our ability to repurchase shares and declare and pay dividends; potential disruption of our operations due to accidents, weather events, including as a result of climate change, acts of terrorism or cyberattacks; general domestic and international economic and political developments, including armed hostilities (such as the Russia-Ukraine war), expropriation of assets, and other diplomatic developments; international monetary conditions and exchange controls; changes in estimates or projections used to assess fair value of intangible assets, goodwill and property and equipment and/or strategic decisions with respect to our asset portfolio that cause impairment charges; investments required, or reduced demand for products, as a result of environmental rules and regulations; changes in tax, environmental and other laws and regulations (including alternative energy mandates); political and societal concerns about climate change that could result in changes to our business or increase expenditures, including litigation-related expenses; the operation, financing and distribution decisions of equity affiliates we do not control; and other economic, business, competitive and/or regulatory factors affecting Phillips 66’s businesses generally as set forth in our filings with the Securities and Exchange Commission. Phillips 66 is under no obligation (and expressly disclaims any such obligation) to update or alter its forward-looking statements, whether as a result of new information, future events or otherwise.

     

     

     

     
     
     

    Earnings

     

     

     

     

     

     

     

     

     

     

     

     

    Millions of Dollars

     

     

    2024

     

     

    2023

     

    3Q  

     

    2Q  

     

    Sep YTD

     

    3Q  

     

    Sep YTD

    Midstream

    $

    644

     

    767

     

    1,965

     

     

    724

     

    2,060

     

    Chemicals

     

    342

     

    222

     

    769

     

     

    104

     

    494

     

    Refining

     

    (108

    )

    302

     

    410

     

     

    1,712

     

    4,481

     

    Marketing and Specialties

     

    (22

    )

    415

     

    759

     

     

    605

     

    1,501

     

    Renewable Fuels

     

    (116

    )

    (55

    )

    (226

    )

     

    22

     

    164

     

    Corporate and Other

     

    (327

    )

    (340

    )

    (989

    )

     

    (354

    )

    (992

    )

    Pre-Tax Income

     

    413

     

    1,311

     

    2,688

     

     

    2,813

     

    7,708

     

    Less: Income tax expense

     

    44

     

    291

     

    538

     

     

    670

     

    1,754

     

    Less: Noncontrolling interests

     

    23

     

    5

     

    41

     

     

    46

     

    199

     

    Phillips 66

    $

    346

     

    1,015

     

    2,109

     

     

    2,097

     

    5,755

     

     

     

     

     

     

     

     

     

     

     

     

     

    Adjusted Earnings

     

     

     

     

     

     

     

     

     

     

     

     

    Millions of Dollars

     

    2024

     

     

    2023

     

    3Q

     

    2Q

     

    Sep YTD

     

    3Q

     

    Sep YTD

    Midstream

    $

    672

     

    753

     

    2,038

     

     

    581

     

    1,915

     

    Chemicals

     

    342

     

    222

     

    769

     

     

    104

     

    494

     

    Refining

     

    (67

    )

    302

     

    548

     

     

    1,742

     

    4,525

     

    Marketing and Specialties

     

    583

     

    415

     

    1,305

     

     

    605

     

    1,501

     

    Renewable Fuels

     

    (116

    )

    (55

    )

    (226

    )

     

    22

     

    164

     

    Corporate and Other

     

    (327

    )

    (340

    )

    (989

    )

     

    (303

    )

    (812

    )

    Pre-Tax Income

     

    1,087

     

    1,297

     

    3,445

     

     

    2,751

     

    7,787

     

    Less: Income tax expense

     

    205

     

    278

     

    709

     

     

    660

     

    1,768

     

    Less: Noncontrolling interests

     

    23

     

    35

     

    71

     

     

    21

     

    218

     

    Phillips 66

    $

    859

     

    984

     

    2,665

     

     

    2,070

     

    5,801

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Millions of Dollars

     

    Except as Indicated

     

    2024

     

     

    2023

     

    3Q

     

    2Q

     

    Sep YTD

     

    3Q

     

    Sep YTD

    Reconciliation of Consolidated Earnings to Adjusted Earnings

     

     

     

     

     

     

     

     

     

     

     

    Consolidated Earnings

    $

    346

     

    1,015

     

    2,109

     

     

    2,097

     

    5,755

     

    Pre-tax adjustments:

     

     

     

     

     

     

     

     

     

     

     

    Impairments 1

     

    28

     

    224

     

    415

     

     

    —

     

    —

     

    Net gain on asset dispositions

     

    —

     

    (238

    )

    (238

    )

     

    (101

    )

    (123

    )

    Change in inventory method for acquired business

     

    —

     

    —

     

    —

     

     

    (46

    )

    (46

    )

    Los Angeles Refinery shutdown-related costs 2

     

    41

     

    —

     

    41

     

     

    —

     

    —

     

    Legal accrual 3

     

    605

     

    —

     

    605

     

     

    30

     

    30

     

    Legal settlement

     

    —

     

    —

     

    (66

    )

     

    —

     

    —

     

    Business transformation restructuring costs

     

    —

     

    —

     

    —

     

     

    51

     

    127

     

    Loss on early redemption of DCP debt

     

    —

     

    —

     

    —

     

     

    —

     

    53

     

    DCP integration restructuring costs

     

    —

     

    —

     

    —

     

     

    4

     

    38

     

    Tax impact of adjustments 4

     

    (161

    )

    13

     

    (171

    )

     

    10

     

    (14

    )

    Noncontrolling interests

     

    —

     

    (30

    )

    (30

    )

     

    25

     

    (19

    )

    Adjusted earnings

    $

    859

     

    984

     

    2,665

     

     

    2,070

     

    5,801

     

    Earnings per share of common stock ( dollars )

    $

    0.82

     

    2.38

     

    4.94

     

     

    4.69

     

    12.61

     

    Adjusted earnings per share of common stock ( dollars ) 5

    $

    2.04

     

    2.31

     

    6.25

     

     

    4.63

     

    12.71

     

     

     

     

     

     

     

     

     

     

     

     

     

    Reconciliation of Segment Pre-Tax Income (Loss) to Adjusted Pre-Tax Income (Loss)

    Midstream Pre-Tax Income

    $

    644

     

    767

     

    1,965

     

     

    724

     

    2,060

     

    Pre-tax adjustments:

     

     

     

     

     

     

     

     

     

     

     

    Impairments 1

     

    28

     

    224

     

    311

     

     

    —

     

    —

     

    Net gain on asset disposition

     

    —

     

    (238

    )

    (238

    )

     

    (101

    )

    (137

    )

    Change in inventory method for acquired business

     

    —

     

    —

     

    —

     

     

    (46

    )

    (46

    )

    DCP integration restructuring costs

     

    —

     

    —

     

    —

     

     

    4

     

    38

     

    Adjusted pre-tax income

    $

    672

     

    753

     

    2,038

     

     

    581

     

    1,915

     

    Chemicals Pre-Tax Income

    $

    342

     

    222

     

    769

     

     

    104

     

    494

     

    Pre-tax adjustments:

     

     

     

     

     

     

     

     

     

     

     

    None

     

    —

     

    —

     

    —

     

     

    —

     

    —

     

    Adjusted pre-tax income

    $

    342

     

    222

     

    769

     

     

    104

     

    494

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Refining Pre-Tax Income (Loss)

    $

    (108

    )

    302

     

    410

     

     

    1,712

     

    4,481

     

    Pre-tax adjustments:

     

     

     

     

     

     

     

     

     

     

     

    Impairments 1

     

    —

     

    —

     

    104

     

     

    —

     

    —

     

    Los Angeles Refinery shutdown-related costs 2

     

    41

     

    —

     

    41

     

     

    —

     

    —

     

    Net loss on asset disposition

     

    —

     

    —

     

    —

     

     

    —

     

    14

     

    Legal accrual 3

     

    —

     

    —

     

    —

     

     

    30

     

    30

     

    Legal settlement

     

    —

     

    —

     

    (7

    )

     

    —

     

    —

     

    Adjusted pre-tax income (loss)

    $

    (67

    )

    302

     

    548

     

     

    1,742

     

    4,525

     

    Marketing and Specialties Pre-Tax Income (Loss)

    $

    (22

    )

    415

     

    759

     

     

    605

     

    1,501

     

    Pre-tax adjustments:

     

     

     

     

     

     

     

     

     

     

     

    Legal accrual 3

     

    605

     

    —

     

    605

     

     

    —

     

    —

     

    Legal settlement

     

    —

     

    —

     

    (59

    )

     

    —

     

    —

     

    Adjusted pre-tax income

    $

    583

     

    415

     

    1,305

     

     

    605

     

    1,501

     

    Renewable Fuels Pre-Tax Income (Loss)

    $

    (116

    )

    (55

    )

    (226

    )

     

    22

     

    164

     

    Pre-tax adjustments:

     

     

     

     

     

     

     

     

     

     

     

    None

     

    —

     

    —

     

    —

     

     

    —

     

    —

     

    Adjusted pre-tax income (loss)

    $

    (116

    )

    (55

    )

    (226

    )

     

    22

     

    164

     

    Corporate and Other Pre-Tax Loss

    $

    (327

    )

    (340

    )

    (989

    )

     

    (354

    )

    (992

    )

    Pre-tax adjustments:

     

     

     

     

     

     

     

     

     

     

     

    Business transformation restructuring costs

     

    —

     

    —

     

    —

     

     

    51

     

    127

     

    Loss on early redemption of DCP debt

     

    —

     

    —

     

    —

     

     

    —

     

    53

     

    Adjusted pre-tax loss

    $

    (327

    )

    (340

    )

    (989

    )

     

    (303

    )

    (812

    )

     

     

     

     

     

     

     

     

     

     

     

     

    1Impairments primarily related to certain gathering and processing assets in the Midstream segment, as well as certain crude oil processing and logistics assets in California, reported in the Refining segment.

    2Shutdown-related costs recorded in the Refining segment include pre-tax charges for severance costs.

    3Legal accrual primarily related to ongoing litigation.

    4We generally tax effect taxable U.S.-based special items using a combined federal and state statutory income tax rate of approximately 24%. Taxable special items attributable to foreign locations likewise use a local statutory income tax rate. Nontaxable events reflect zero income tax. These events include, but are not limited to, most goodwill impairments, transactions legislatively exempt from income tax, transactions related to entities for which we have made an assertion that the undistributed earnings are permanently reinvested, or transactions occurring in jurisdictions with a valuation allowance.

    5YTD 2024, Q3 2024, Q3 2023 are based on adjusted weighted-average diluted shares of 426,301 thousand, 419,827 thousand, and 447,255 thousand, respectively. Other periods are based on the same weighted-average diluted shares outstanding as that used in the GAAP diluted earnings per share calculation. Income allocated to participating securities, if applicable, in the adjusted earnings per share calculation is the same as that used in the GAAP diluted earnings per share calculation.

     
     
     

     

    Millions of Dollars

     

    Except as Indicated

     

    2024

     

    3Q

     

    2Q

     

    Reconciliation of Consolidated Net Income to Adjusted EBITDA

     

     

     

     

    Net Income

    $

    369

     

    1,020

     

    Plus:

     

     

     

     

    Income tax expense

     

    44

     

    291

     

    Net interest expense

     

    191

     

    200

     

    Depreciation and amortization

     

    543

     

    497

     

    Phillips 66 EBITDA

    $

    1,147

     

    2,008

     

    Special Item Adjustments (pre-tax):

     

     

     

     

    Impairments

     

    28

     

    224

     

    Net gain on asset disposition

     

    —

     

    (238

    )

    Los Angeles Refinery shutdown-related costs

     

    41

     

    —

     

    Legal accrual

     

    605

     

    —

     

    Legal settlement

     

    —

     

    —

     

    Total Special Item Adjustments (pre-tax)

     

    674

     

    (14

    )

    Change in Fair Value of NOVONIX Investment

     

    —

     

    7

     

    Phillips 66 EBITDA, Adjusted for Special Items and Change in Fair Value of NOVONIX Investment

    $

    1,821

     

    2,001

     

    Other Adjustments (pre-tax):

     

     

     

     

    Proportional share of selected equity affiliates income taxes

     

    24

     

    26

     

    Proportional share of selected equity affiliates net interest

     

    12

     

    19

     

    Proportional share of selected equity affiliates depreciation and amortization

     

    188

     

    195

     

    Adjusted EBITDA attributable to noncontrolling interests

     

    (47

    )

    (58

    )

    Phillips 66 Adjusted EBITDA

    $

    1,998

     

    2,183

     

     

     

     

     

     

    Reconciliation of Segment Income before Income Taxes to Adjusted EBITDA

     

     

     

     

    Midstream Income before income taxes

    $

    644

     

    767

     

    Plus:

     

     

     

     

    Depreciation and amortization

     

    233

     

    224

     

    Midstream EBITDA

    $

    877

     

    991

     

    Special Item Adjustments (pre-tax):

     

     

     

     

    Net gain on asset disposition

     

    —

     

    (238

    )

    Impairments

     

    28

     

    224

     

    Midstream EBITDA, Adjusted for Special Items

    $

    905

     

    977

     

    Other Adjustments (pre-tax):

     

     

     

     

    Proportional share of selected equity affiliates income taxes

     

    5

     

    5

     

    Proportional share of selected equity affiliates net interest

     

    3

     

    10

     

    Proportional share of selected equity affiliates depreciation and amortization

     

    26

     

    37

     

    Adjusted EBITDA attributable to noncontrolling interests

     

    (47

    )

    (58

    )

    Midstream Adjusted EBITDA

    $

    892

     

    971

     

    Chemicals Income before income taxes

    $

    342

     

    222

     

    Plus:

     

     

     

     

    None

     

    —

     

    —

     

    Chemicals EBITDA

    $

    342

     

    222

     

    Special Item Adjustments (pre-tax):

     

     

     

     

    None

     

    —

     

    —

     

    Chemicals EBITDA, Adjusted for Special Items

    $

    342

     

    222

     

    Other Adjustments (pre-tax):

     

     

     

     

    Proportional share of selected equity affiliates income taxes

     

    13

     

    15

     

    Proportional share of selected equity affiliates net interest

     

    (2

    )

    —

     

    Proportional share of selected equity affiliates depreciation and amortization

     

    113

     

    111

     

    Chemicals Adjusted EBITDA

    $

    466

     

    348

     

    Refining Income (loss) before income taxes

    $

    (108

    )

    302

     

    Plus:

     

     

     

     

    Depreciation and amortization

     

    230

     

    204

     

    Refining EBITDA

    $

    122

     

    506

     

    Special Item Adjustments (pre-tax):

     

     

     

     

    Los Angeles Refinery shutdown-related costs

     

    41

     

    —

     

    Refining EBITDA, Adjusted for Special Items

    $

    163

     

    506

     

    Other Adjustments (pre-tax):

     

     

     

     

    Proportional share of selected equity affiliates income taxes

     

    (1

    )

    1

     

    Proportional share of selected equity affiliates net interest

     

    (1

    )

    (2

    )

    Proportional share of selected equity affiliates depreciation and amortization

     

    27

     

    26

     

    Refining Adjusted EBITDA

    $

    188

     

    531

     

    Marketing and Specialties Income (loss) before income taxes

    $

    (22

    )

    415

     

    Plus:

     

     

     

     

    Depreciation and amortization

     

    32

     

    32

     

    Marketing and Specialties EBITDA

    $

    10

     

    447

     

    Special Item Adjustments (pre-tax):

     

     

     

     

    Legal accrual

     

    605

     

    —

     

    Marketing and Specialties EBITDA, Adjusted for Special Items

    $

    615

     

    447

     

    Other Adjustments (pre-tax):

     

     

     

     

    Proportional share of selected equity affiliates income taxes

     

    7

     

    5

     

    Proportional share of selected equity affiliates net interest

     

    12

     

    11

     

    Proportional share of selected equity affiliates depreciation and amortization

     

    22

     

    21

     

    Marketing and Specialties Adjusted EBITDA

    $

    656

     

    484

     

    Renewable Fuels Loss before income taxes

    $

    (116

    )

    (55

    )

    Plus:

     

     

     

     

    Depreciation and amortization

     

    24

     

    12

     

    Renewable Fuels EBITDA

    $

    (92

    )

    (43

    )

    Special Item Adjustments (pre-tax):

     

     

     

     

    None

     

    —

     

    —

     

    Renewable Fuels EBITDA, Adjusted for Special Items

    $

    (92

    )

    (43

    )

    Corporate and Other Loss before income taxes

    $

    (327

    )

    (340

    )

    Plus:

     

     

     

     

    Net interest expense

     

    191

     

    200

     

    Depreciation and amortization

     

    24

     

    25

     

    Corporate and Other EBITDA

    $

    (112

    )

    (115

    )

    Special Item Adjustments (pre-tax):

     

     

     

     

    None

     

    —

     

    —

     

    Total Special Item Adjustments (pre-tax)

     

    —

     

    —

     

    Change in Fair Value of NOVONIX Investment

     

    —

     

    7

     

    Corporate EBITDA, Adjusted for Special Items and Change in Fair Value of NOVONIX Investment

    $

    (112

    )

    (108

    )

     

     

     

     

     

     

     

     

     

     

    Millions of Dollars

     

    Except as Indicated

     

    September 30, 2024

    Debt-to-Capital Ratio

     

    Total Debt

    $

    19,998

     

    Total Equity

     

    29,784

     

    Debt-to-Capital Ratio

     

    40

    %

    Total Cash

     

    1,637

     

    Net Debt-to-Capital Ratio

     

    38

    %

     

     

     

     

     

     

    Millions of Dollars

     

    September 30, 2024

    Reconciliation of Net Cash Used in Operating Activities to Operating Cash Flow, Excluding Working Capital

     

    Net Cash Used in Operating Activities

    $

    1,132

     

    Less: Net Working Capital Changes

     

    (381

    )

    Operating Cash Flow, Excluding Working Capital

    $

    1,513

     

     

     

     

    Millions of Dollars

     

    Except as Indicated

     

    2024

     

    3Q

     

    2Q

     

    Reconciliation of Refining Income (Loss) Before Income Taxes to Realized Refining Margins

     

     

     

     

    Income (loss) before income taxes

    $

    (108

    )

    302

     

    Plus:

     

     

     

     

    Taxes other than income taxes

     

    100

     

    74

     

    Depreciation, amortization and impairments

     

    230

     

    203

     

    Selling, general and administrative expenses

     

    60

     

    51

     

    Operating expenses

     

    922

     

    884

     

    Equity in earnings of affiliates

     

    12

     

    (33

    )

    Other segment expense, net

     

    (4

    )

    (1

    )

    Proportional share of refining gross margins contributed by equity affiliates

     

    193

     

    260

     

    Special items:

     

     

     

     

    None

     

    —

     

    —

     

    Realized refining margins

    $

    1,405

     

    1,740

     

    Total processed inputs ( thousands of barrels )

     

    145,440

     

    151,296

     

    Adjusted total processed inputs ( thousands of barrels )*

     

    168,951

     

    174,107

     

    Income (loss) before income taxes ( dollars per barrel )**

    $

    (0.74

    )

    2.00

     

    Realized refining margins ( dollars per barrel )***

    $

    8.31

     

    10.01

     

    *Adjusted total processed inputs include our proportional share of processed inputs of an equity affiliate.

     
     

    **Income before income taxes divided by total processed inputs.

    ***Realized refining margins per barrel, as presented, are calculated using the underlying realized refining margin amounts, in dollars, divided by adjusted total processed inputs, in barrels. As such, recalculated per barrel amounts using the rounded margins and barrels presented may differ from the presented per barrel amounts.

    Source: Phillips 66

    MIL OSI Economics –

  • MIL-OSI Economics: Record, Transcribe and Translate: Effortless Festivities with Note Assist on the Galaxy S24 Ultra

    Source: Samsung

    This Diwali, the Galaxy S24 Ultra is taking ease and efficiency to new heights with the Galaxy AI-powered Note Assist feature, designed to empower users to capture, organize, and share moments with unmatched simplicity.
     
    Now you can seamlessly navigate the hustle of festive gatherings, using Note Assist as a trusted partner. With just a tap, you can record heartfelt conversations, transcribe important details, and translate messages for loved ones who speak different languages. Note Assist brings to you a true celebration of effortless connections.
     
    It ensures that every moment is preserved, shared, and understood with ease.
     
    Watch more to see how Note Assist transforms every interaction:
     

    MIL OSI Economics –

  • MIL-OSI Economics: MTN SA and Huawei Launch World’s First Commercial SDB IBT 2D Microwave Deployment Oct 29, 2024

    Source: Huawei

    Headline: MTN SA and Huawei Launch World’s First Commercial SDB IBT 2D Microwave Deployment
    Oct 29, 2024

    [Johannesburg, South Africa, October 29th, 2024] MTN South Africa (hereinafter referred to as MTN SA) and Huawei have completed the world’s first commercial deployment of the innovative SDB IBT 2D microwave solution in Johannesburg. This breakthrough solution leverages Super Dual Band (SDB) and two-dimensional intelligent beam tracking (IBT 2D) to prevent pole shaking from affecting link stability in dual-band scenarios.
    With a large portion of its territory on a plateau, South Africa is typically exposed to intense sunlight. Separately, the considerable temperature difference between day and night can lead to deformation of towers across the country, typically monopole and mast towers. This deformation degrades the performance of existing large-capacity SDB transmission links (the E-band frequencies sub-system particularly) and has a negative impact on services. Given that it is difficult to obtain tower space and permission for installing two separate antennas for one physical link at a single site, the new IBT-capable SDB antenna fulfils an urgent market need.
    Huawei continuously invests in E-band IBT and SDB technologies and launched the innovative SDB IBT 2D solution that allows a single antenna to support dual-band transmission via both traditional band and E-band. The solution also supports two-dimensional IBT function, which enables vertical sway and horizontal twist to be adjusted in real time to counteract the shaking, warping, and deformation of poles and towers caused by sunshine or wind. The co-deployment of this solution with MTN SA in Johannesburg marks its first commercial deployment in the world.
    MTN SA and Huawei Launch World’s First SDB IBT 2D Microwave link

    Through this deployment, the SDB IBT 2D solution helps MTN SA address periodic fading and unstable performance of microwave links caused by periodic pole deformation, while also enhancing the anti-shaking performance of SDB links. This guarantees 100% reliable transmission and expands SDB deployment scenarios by 66% for MTN SA. Deploying this new antenna occupies less space on a tower than installing two separate single-band antennas. Additionally, the IBT function removes restrictions on tower type and antenna installation height and ensures that services are always online. The SDB IBT 2D solution will enhance MTN SA’s site construction by providing large-capacity and consistently stable transmission.
    Commenting on the deployment of the IBT solution, Rodney Reddy, Transmission Planning Senior Manager of MTN SA, remarked: “We are dedicated to delivering the best network and services for users by adhering to high construction standards. IBT solution helps us solve link problems caused by the external environment to ensure stable service running. It is now an essential solution for our E-band network construction.”
    James Zeng, President of Huawei’s Microwave Product Line, commented: “We are committed to continuous innovation in microwave transmission. We offer high-quality microwave transmission solutions tailored to multiple complex scenarios. Our latest SDB IBT solution supports stable transmission even in complex weather conditions, enabling customers to build high-quality networks to exacting standards.”

    MIL OSI Economics –

  • MIL-OSI Economics: MTN SA and Huawei Launch World’s First Commercial SDB IBT 2D Microwave Deployment

    Source: Huawei

    Headline: MTN SA and Huawei Launch World’s First Commercial SDB IBT 2D Microwave Deployment

    [Johannesburg, South Africa, October 29th, 2024] MTN South Africa (hereinafter referred to as MTN SA) and Huawei have completed the world’s first commercial deployment of the innovative SDB IBT 2D microwave solution in Johannesburg. This breakthrough solution leverages Super Dual Band (SDB) and two-dimensional intelligent beam tracking (IBT 2D) to prevent pole shaking from affecting link stability in dual-band scenarios.
    With a large portion of its territory on a plateau, South Africa is typically exposed to intense sunlight. Separately, the considerable temperature difference between day and night can lead to deformation of towers across the country, typically monopole and mast towers. This deformation degrades the performance of existing large-capacity SDB transmission links (the E-band frequencies sub-system particularly) and has a negative impact on services. Given that it is difficult to obtain tower space and permission for installing two separate antennas for one physical link at a single site, the new IBT-capable SDB antenna fulfils an urgent market need.
    Huawei continuously invests in E-band IBT and SDB technologies and launched the innovative SDB IBT 2D solution that allows a single antenna to support dual-band transmission via both traditional band and E-band. The solution also supports two-dimensional IBT function, which enables vertical sway and horizontal twist to be adjusted in real time to counteract the shaking, warping, and deformation of poles and towers caused by sunshine or wind. The co-deployment of this solution with MTN SA in Johannesburg marks its first commercial deployment in the world.
    MTN SA and Huawei Launch World’s First SDB IBT 2D Microwave link

    Through this deployment, the SDB IBT 2D solution helps MTN SA address periodic fading and unstable performance of microwave links caused by periodic pole deformation, while also enhancing the anti-shaking performance of SDB links. This guarantees 100% reliable transmission and expands SDB deployment scenarios by 66% for MTN SA. Deploying this new antenna occupies less space on a tower than installing two separate single-band antennas. Additionally, the IBT function removes restrictions on tower type and antenna installation height and ensures that services are always online. The SDB IBT 2D solution will enhance MTN SA’s site construction by providing large-capacity and consistently stable transmission.
    Commenting on the deployment of the IBT solution, Rodney Reddy, Transmission Planning Senior Manager of MTN SA, remarked: “We are dedicated to delivering the best network and services for users by adhering to high construction standards. IBT solution helps us solve link problems caused by the external environment to ensure stable service running. It is now an essential solution for our E-band network construction.”
    James Zeng, President of Huawei’s Microwave Product Line, commented: “We are committed to continuous innovation in microwave transmission. We offer high-quality microwave transmission solutions tailored to multiple complex scenarios. Our latest SDB IBT solution supports stable transmission even in complex weather conditions, enabling customers to build high-quality networks to exacting standards.”

    MIL OSI Economics –

  • MIL-OSI Economics: Samsung Expands its Independent Service Provider Network, Adding Over 400 Cell Phone Repair (CPR) by Assurant TM Stores

    Source: Samsung

    Samsung and Cell Phone Repair TM by Assurant (“CPR”) are expanding their partnership to give customers even more options for trusted device care, even when their warranty has expired. For over three years, CPR has been an integral Independent Service Provider (ISP) within Samsung’s extensive and robust repair network.
    From approximately 100 locations at the start of 2024, Samsung will add over 300 CPR locations  to its repair network by years end. This brings the total number of CPR stores to over 400 and the overall Assurant Repair Network to over 900 locations[1].
    Trusted Galaxy Repairs: Certified Technicians and Genuine Parts
    Whether it’s out-of-warranty repairs, cracked screens, a battery replacement – or to purchase device accessories – Galaxy customers can trust they will receive the best care possible now at any in network CPR store. All CPR Technicians are certified by the CTIA’s Wireless Industry Service Excellence (WISE) program.
    With access to Samsung’s comprehensive training tools and videos, customers can have peace of mind knowing their devices are repaired to the highest industry standards — and that ISPs can complete their repair using only genuine Samsung parts and equipment. With most repairs taking less than 1 hour, CPR stores also offer customers the confidence of backing repairs with a limited warranty.

    MIL OSI Economics –

  • MIL-OSI Economics: New AML/CFT Legislation

    Source: Isle of Man

    Revised legislation to update the Island’s AML/CFT framework has now commenced.

    Links to the new legislation, including the Travel Rule (Transfer of Virtual Assets) Code 2024, can be found on our website here under the Legislation tab.

    MIL OSI Economics –

  • MIL-OSI Economics: Secretary-General of ASEAN meets with Secretary of the Department of Labor and Employment of the Philippines

    Source: ASEAN

    On his first day in Singapore  attending the 28th ASEAN Labour Ministers’ Meeting, Secretary-General of ASEAN, Dr. Kao Kim Hourn, this evening met with Secretary Bienvenido E. Laguesma of the Philippines’ Department of Labor and Employment. During the meeting, both sides exchanged views on the initiatives led by the Philippines in the ASEAN Labour Ministers’ Work Programme and labour-related priorities and looked forward to working closely with the Philippines during its Chairmanship of ASEAN in 2026.

    The post Secretary-General of ASEAN meets with Secretary of the Department of Labor and Employment of the Philippines appeared first on ASEAN Main Portal.

    MIL OSI Economics –

  • MIL-OSI Economics: A test of resolve: credible resolution following the 2023 banking turmoil

    Source: Bank for International Settlements

    Introduction

    I would like to welcome you all to the Resolution Conference 2024, the first that has been co-organised by the BIS Financial Stability Institute (FSI), the Financial Stability Board (FSB) and the International Association of Deposit Insurers (IADI). This event is motivated by the banking turmoil in March 2023. The 18 months that have passed since those events have given time to reflect seriously on it and derive some lessons. This conference provides an opportunity to take stock, compare notes and try to identify a productive way forward.

    Scene-setting

    It is now commonplace to say that the March 2023 failures of several US regional banks, followed a week later by the near failure of Credit Suisse, were the first meaningful test of the international resolution framework that was put in place following the Great Financial Crisis (GFC).

    The headline message is that large bank failures did not lead to a systemic crisis. Authorities managed them in an orderly manner with no ultimate loss to public funds. Creditors and shareholders bore losses. In the case of Credit Suisse, there was a significant writedown of loss-absorbing instruments. This is a noteworthy achievement, and stands in stark contrast to the GFC.

    The extensive work to put in place cross-border cooperative arrangements has demonstrably strengthened the financial system. The outcomes might have been very different without the planning and coordination that took place between home and host authorities, and the understanding and trust that have been developed.

    However, work remains to be done. The reports published last year by the FSB and IADI set out lessons learned for resolution and deposit insurance.1 They include the risk of faster failures, accelerated by digital technologies; the scope of resolution planning and requirements for loss-absorbing capacity (LAC); and flexibility in resolution strategies. Other reports, including by the Basel Committee on Banking Supervision, elaborate on the supervisory shortcomings and the vulnerabilities arising from large quantities of uninsured deposits. Work on all these issues is ongoing.

    In any case, I would like to concentrate my remarks on two elements of the bank resolution framework that I think must be tackled as we go forward. The first is the power to bail-in creditors as a key element of resolution strategies. The second is the need to put in place effective facilities for providing liquidity in resolution. The events of March 2023 highlighted the importance of both. They are also among the elements of a resolution framework that are most challenging to implement.

    The credibility of bail-in

    Bail-in powers are core to the resolution framework adopted after the GFC. Bail-in allows a systemically important bank to be recapitalised without the need to find a buyer for its business or to split up its operations, at least in the short term. Appropriate liabilities absorb losses without putting a failing bank into insolvency. Crucially, it is designed to ensure that a bank’s owners and investors, rather than depositors or taxpayers, bear the costs of resolution costs.

    In practice, a bail-in is a highly complex transaction involving multiple parties, and a huge amount of work has been carried out on how to execute it. A typical bail-in would involve multiple valuations; a mechanism to write down and cancel instruments, which are likely to be traded; and the issuance of new shares to the bailed-in debt holders. The process has been mapped out in detail by resolution authorities. However, a full bail-in strategy remains untested.

    Credit Suisse had a resolution strategy based on bail-in, and FINMA and key host authorities had prepared extensively to execute that strategy.

    In the end, the Swiss authorities chose not to follow the resolution playbook because they had another option that achieved their objectives: a state-brokered commercial merger of Credit Suisse and UBS. Nevertheless, the contractual writedown of all the outstanding Additional Tier 1 (AT1) capital instruments issued by Credit Suisse was a key element of the transaction. The writedown extinguished liabilities amounting to CHF 16 billion from the bank’s balance sheet.2

    Although the writedown was more limited than that planned under the full bail-in strategy for Credit Suisse, it demonstrates that bail-in is a core instrument in the crisis management framework. Contrary to what some commentators have feared, a substantial debt writedown is possible and can be executed without significant systemic disruption.

    Nevertheless, there are a few lessons to draw from this to reinforce that bail-in is credible and feasible.

    Flexible resolution toolkits

    First, authorities need flexibility. Planning is essential, but it cannot be prescriptive. We cannot know with absolute confidence in advance how a failure will happen and what actions will best safeguard financial stability. Accordingly, authorities need options so that they can shape their response to the circumstances of a failure. This implies a toolkit approach under which authorities can combine the use of different tools.

    The Credit Suisse transaction demonstrated that, even in the case of a global systemically important bank (G-SIB), bail-in may not be an exclusive strategy, but debt writedown could be a core element. Moreover, bail-in is not a tool exclusively for G-SIBs. For other banks, the writedown of liabilities in resolution can finance transfers of business and reduce the demands on industry-funded sources such as deposit insurance funds.

    Flexibility of this kind brings operational complexities. A toolbox approach means that authorities and firms need to accommodate different options in resolution planning. Banks will need the systems and capabilities to support those options. Key aspects of resolvability such as structure and LAC may become even more complex. However, an effective toolbox approach will further reduce the residual risk that public funds will be needed in crisis management.

    Loss-absorbing capacity

    Second, for bail-in to be credible banks must have liabilities that can be written down with legal certainty and without systemic impact. The FSB’s TLAC standard ensures this for G-SIBs. Some jurisdictions have extended similar requirements for LAC to other banks that could be systemic in failure.

    For example, the EU requirement for resolution-related LAC, the minimum requirement for own funds and eligible liabilities (MREL) – applies to all banks. The amount above the regulatory minimum required for individual banks is based on their resolution strategy. It aims to ensure that any bank that is expected to be resolved rather than wound up maintains LAC in sufficient quantity and quality to absorb losses and recapitalise it in resolution.

    The US financial regulators have consulted on a proposal to require banks with $100 billion or more in assets to maintain a layer of long-term debt. This additional LAC would be used, in the event of a bank’s failure, to absorb losses and increase the resolution options. It should also foster depositor confidence among uninsured deposits.

    The three US regional banks that failed in 2023 had little or no outstanding long-term debt. It has been observed elsewhere that if the proposed requirement had applied to Silicon Valley Bank and Signature Bank, they might have been resolved within the FDIC’s normal funding constraints, without a systemic risk exception being required.3

    If bail-in is to help fund resolution transfers, there need to be instruments that can be written down. The amounts are lower than that needed to recapitalise the bank and finance restructuring in a “pure” bail-in. Nevertheless, calibrating those requirements may be challenging.

    Moreover, meeting LAC requirements should not put banks’ legitimate business models in jeopardy. This is particularly relevant for banks that are predominantly deposit funded. A pragmatic way to alleviate the challenges for those banks is to take account of the resolution funding available from external sources, such as deposit insurance or resolution funds, when setting LAC requirements.4

    Liquidity for crisis management

    Let me turn now to liquidity for crisis management. Resolution powers can recapitalise a failing bank through bail-in. However, capital is not enough on its own. Without liquidity, the resolution will fail.

    Market funding will almost certainly not be available to a bank following its resolution until counterparty confidence can be restored. Resolution frameworks therefore require a credible source of liquidity, at the necessary scale and for a sufficient period of time to allow a resolved firm to return to market-based funding.

    This is recognised by the FSB, which has published two sets of guidance on funding in resolution. However, the arrangements in place vary considerably across jurisdictions and in many cases are not designed for the resolution needs of systemically important banks.

    The liquidity arrangements that were needed in the case of Credit Suisse support this point. The Swiss government had been working on a public liquidity backstop, but this was not yet in place in March 2023. Accordingly, the authorities had to adopt emergency legislation to enable the Swiss National Bank (SNB) to provide a liquidity facility of up to CHF 200 billion. Part of that lending was uncollateralised and coupled with a privileged bankruptcy status for the SNB and part was backed by a guarantee from the Swiss state.

    This case illustrates that ordinary central bank lending arrangements, including emergency liquidity assistance, may not be sufficient for resolution. The amount of liquidity needed by a systemically important bank will be considerable and required over an extended period. Moreover, lending may need to be secured against a wider range of assets or, in extreme circumstances, be uncollateralised. Arrangements for resolution funding must meet these needs. This implies a fiscal backstop to increase the firepower where that is needed.

    A fiscal backstop might appear to introduce a risk to public funds, something that the framework for ending “too big to fail” was designed to avoid. But the risks of loss to public funds should be low. It’s worth noting that all lending in relation to Credit Suisse was repaid, and no losses were incurred by the SNB or the Swiss state under its indemnity. If resolution is effective, the bank will be viable and the borrowing should be repaid.

    Concluding remarks

    I will end where I began. Financial crises provide a good opportunity to identify flaws or shortcomings in the policy framework. The March 2023 banking turmoil was the most significant banking crisis since the GFC and the subsequent policy reforms. Therefore, we should grasp this opportunity to draw lessons.

    Overall, authorities managed to preserve financial stability. In Switzerland, that was accomplished, despite the failure of a G-SIB, without any cost to the taxpayer. This was a remarkable achievement, and the resolution framework developed after the GFC contributed to that.

    But we also need to take note of the obstacles encountered in the process. In particular, it is clear that maximising the potential of bail-in and the provision of liquidity in resolution are pending tasks that need to be addressed.

    Work to do that is ongoing, and this conference is a small but significant part of that process. I am delighted that so many people have come to Basel to participate, and I expect productive discussions during the day.

    MIL OSI Economics –

  • MIL-OSI Economics: Frank Elderson: Finance and Biodiversity Day of 16th United Nations Conference on Biological Diversity (COP16) – transcript of video recording

    Source: Bank for International Settlements

    The global economy and finance need nature to survive. Analysis by the ECB shows that the economy depends critically on nature: 72% of non-financial businesses in the euro area – around 4.2 million individual companies – would experience significant problems as a result of ecosystem degradation. These businesses rely on ecosystem services like fertile soils, timber and clean water. And 75% of bank loans are tied to these businesses. So, if they run into trouble, the banks that finance them will too. This interdependence underscores why the ECB made nature one of the focus areas of its climate and nature plan for 2024 and 2025. It is also why we push banks under our supervision to manage all material nature-related risks.

    The ECB does not stand alone in recognising this threat. The value of nature for the economy is acknowledged by the global Network of Central Banks and Supervisors for Greening the Financial System, which has 141 members worldwide. Additionally, a recent stocktake by the Financial Stability Board showed that a growing number of policy authorities around the world are considering the potential implications of nature-related risks for financial stability.

    In recognition of the vital importance of nature for the economy, international fora must ensure that nature considerations are fully integrated into regulation and supervision, alongside ongoing efforts to account for climate-related considerations. This starts with identifying exposures and vulnerabilities to nature-related risks.

    While central banks and supervisors are not nature policymakers, we must take nature into account to fulfil our mandate of price stability and safe and sound banks. Otherwise, we risk failing to deliver on our mandate.

    My message on this Finance and Biodiversity Day is clear: if you destroy nature, you destroy the economy. The right conditions must be established for nature – and consequently the economy – to thrive. The economy needs nature to survive. Financial stability needs nature to survive. To deliver on our mandate, we need nature to survive. And the survival of nature requires financing. Therefore, your success here in Cali is vitally important.

    Thank you. Buena suerte.

    MIL OSI Economics –

  • MIL-OSI Economics: Andrew Bailey: Michael D Gill Memorial Society Lecture

    Source: Bank for International Settlements

    Quite simply, I wish I was not giving this lecture today. Or, perhaps better, I wish I was giving it with Mike Gill here to participate. But, only one of those is possible due to his tragic and senseless killing. I am sure I am not alone in thinking that when these events happen to people we do not know, we find a sort of anesthetised isolation by resorting to commenting on the public policy implications in a rather dehumanised way. But when it happens to someone we knew, hugely liked and respected, who was without question a good person, then it is almost natural to be lost for words. It has taken me a long time to compose thoughts on someone to and about whom I could say so much in life.

    There is an old saying that someone is a pillar of society. They are the people who support and hold society together. Well, Mike was without question a pillar of society. He was generous, kind, thoughtful and very supportive. Kristina, Sean, Brian, and Annika, as you know even better than us, he was an outstanding person.

    But Mike was not a pillar of society in the sense of that term of someone who was stuck in the past, holding together a world that was lost. He was a moderniser, and that was why it was so appropriate that he served at the CFTC, which has its history but also is at one of the cutting edges of finance. Mike loved that. He talked at length about visiting farms with Chris and about the technology changing farms and agricultural markets. But he was also an enthusiast to find an appropriate treatment of cryptocurrency in derivatives markets.

    The second thing about Mike and his work here at the CFTC that naturally brought us together was that he was a passionate internationalist. And he always seemed happy to visit London, and it was always good to see him there. Our international travel went further. There is a memorable, for me certainly, picture of the two of us on a boat trip in Sydney Harbour in 2019.

    It wasn’t just the travel. Mike was, like Chris, an internationalist through and through. I spent time with Mike after the UK’s Brexit Referendum in 2016. I am strictly neutral on Brexit as a public official. I knew then that our job was to work out how to implement something that, let’s be honest, had not been planned. In the area of financial services, clearing was going to be probably the hardest area for us, because – and I will come back to this point – it is inherently international in many parts, and particularly the parts we do in London. I knew immediately after the Referendum that it was critical for the UK not to become isolated and certainly not isolationist. That would be the road to a very bad outcome for the City of London. We needed friends, both in deeds and words, those who would be prepared to stand by us, and put up with uncertainty while we worked out the best course. Chris, you and Mike were those people – friends when we were in some need.

    Now, it is the case that, as a internationalist, Mike arrived in the world of clearing at the right time. It is a fairly esoteric activity, always important, but also often in the background. We quite like it to be humming away safely in the background. But the Global Financial crisis had emphasised that we had undervalued its importance, that the world would have been safer if we had put It more into the centre of the financial system.

    But, to do that it must be done safely and soundly. Unsafe clearing would be worse than no clearing, it would amount to concentrating the risk in one unsafe house.

    And so, if we are asked to list the very big financial system changes post financial crisis, we should naturally start by saying that we have put clearing at the heart of the system. Central Counterparties (CCPs) are a key to mitigating counterparty credit risk, which has become even more relevant following the crisis and, in so doing, bring significant financial stability benefits. The experience of the collapse of Lehman Brothers demonstrated that CCPs should be able to dampen the shock of a major counterparty credit failure. One of my abiding memories of the Lehman weekend was the attempt to organise an ad-hoc trade position compression exercise, to net down the positions. It wasn’t possible, and the hard lesson was that only permanent institutional structures with clearing houses at their heart can achieve the ends we desired.

    But, of course, we know that CCPs, can pose significant risks to the stability of the financial system if they are not properly managed. A consequence of central clearing is that CCPs themselves become a financial network which can bring about the contagion of financial instability if they are not robustly established and operated. In line with G20 commitments following the Financial Crisis, the introduction of mandatory clearing for various classes of over-the-counter derivatives has driven an increase in the systemic importance of CCPs.

    In the banking world, that tendency for banks to grow and become more globally systemic led to hostility to allowing very large banks which could be too big to fail. Clearing is different. Its not just that clearing didn’t cause the crisis, though just to be clear, it didn’t. Rather, its more than that. Up to some point, and that point can naturally be large, there are benefits of scale and scope in clearing. Yes, there is contagion risk if a CCP fails, and especially where it is large in its market, but there are real benefits of scope and scale.

    And, this naturally leads to the international dimension that Mike so much emphasised. The global nature of many financial markets means that clearing is naturally a
    cross-border activity. Cross-border clearing also brings significant benefits. A single CCP operating across multiple jurisdictions and currencies can provide efficiencies and reduce risk through multilateral settling of exposures across counterparties in different jurisdictions.

    This puts an obligation on us as regulators of clearing houses. We have a duty to enable the safe operation of the global financial system. Public authorities have risen to this duty, supervising standards on CCPs have been strengthened and new international standards have driven the establishment of credible CCP resolution regimes. We also have a deep sense of responsibility for the impact of our actions on other countries. And, we take this very seriously, as we must. In the UK, as the regulator we are required in any exercise of our rule-making power to consider the effects of these rules on the financial stability of any country where one of our clearing houses provides services, and we must act in a way that does not favour one jurisdiction over another.

    This is of course all common sense. We all recognise that the interconnectedness of global markets means that any shocks in one part of the world can quickly reverberate and cause stress elsewhere. But common sense though it is, I can tell you that it’s a lot easier to put into practice when you are working with someone like Mike Gill, who wants to get things done and is at heart an internationalist.

    And, so it should be no surprise that during the period Mike was here at the CFTC, things did get done, and they continue to get done building on his legacy.

    There is another feature of clearing that is distinctive. As I said earlier, by its very nature it concentrates the risks associated with the trades being cleared. That’s how and why CCPs are such crucial nodes in the financial system. But it also means that if a CCP doesn’t manage its risk well, the concentration magnifies the impact of the problem. Moreover, CCPs tend to be highly interconnected because the instruments they clear are likewise interconnected – think about the different ways to trade interest rate risk. A small number of CCPs provide most of the capacity in over the counter derivatives clearing. And, a small number of clearing members provide the majority of clearing services to clients at all of these big CCPs. These firms are also providing key services to the CCPs, such as settlement, custody and liquidity backstops.

    We can take a few points from this. Clearing is quite complicated and technical as an activity. I’m going to stick my neck out and suggest that here in Washington, conversations in bars are not of the sort: “tell me how does margining in a clearing house work”. Its notoriously a dry subject, but important, hugely so. But therein lies a risk – even at international meetings there can seem to be other things to talk about, happily so, and that can lead to problems of neglect.

    Except, onto the scene came Mike Gill and Chris Giancarlo. The enthusiasts had arrived. Suddenly, it seemed a pleasure to talk about clearing. The fun kids talked about clearing. The serious point is that supervising big CCPs requires deep cooperation between authorities across multiple jurisdictions. It requires cooperation not fragmentation. We knew how to do that, but it always seemed harder to put in practice than it should have done. We don’t like economic fragmentation in the world, rightly so, but somehow arguments are made that its ok to do so for clearing. No it isn’t as a matter of fact, because such a view defies the logic of how financial markets work. Supervising and regulatory cooperation is a key part of the right approach.

    I want to finish by looking forwards. I think that is what Mike would want, because it was very much as I remember him. There was always something new and interesting, whether it was drones overseeing crop production or crypto assets.

    The importance and role of clearing continues to grow rapidly. A few facts help to illustrate the importance of clearing. I will focus on UK-US clearing facts. The notional amount of OTC derivatives cleared by UK CCPs with US counterparties continues to be greater than that cleared with any other jurisdiction. Across the three UK CCPs, 38% of margin is derived from US clearing members, and volumes have been larger this year than last, which was also up on previous years.

    Overall, one thing that lies behind this growth is a rise in non-bank financial intermediation versus bank intermediation. We should not be surprised at this. But let me go back to 2008 and the Lehman weekend for a moment. The attempt to put in place an ad-hoc trade compression process – to net down exposures – reflected in the main banks having – sloppily – built up very large derivative books, and not managed them effectively. I remember several CEOs told me at the time that it just had not occurred to them that they needed to manage these books efficiently.

    Indeed, it was very clear that for quite a few, there was very little awareness of the problem that was building up. It was too easy to pile trade upon trade with little regard for the need to risk manage these books throughly.

    And then the music stopped, and suddenly what had been out of sight and out of mind in the good times became a problem. Outsized books had to be managed down by banks. Today that legacy is behind us. But the scale of derivative activity has nonetheless grown much further. That growth has provided important hedging benefits, and it has enabled much larger position limits to exist, concentrated more in the non-bank sector, but inevitably with links into the banking system. The so-called basis trade is a good example of this.

    These developments leave us with major puzzles. Is there a scale of activity beyond which stress sets in when it has to be unwound quite suddenly? What would be the effects of that stress? And how do we model such a fluid landscape, where stress could emerge in several places at once? Better tools of diagnosis are important here.

    At the Bank of England we have designed and run something we call the System Wide Exploratory Scenario, which seeks to synthesise the effects of some severe but plausible shocks passing through the financial system. Over 50 firms have participated, as have the clearing houses that support the activity. This is not a stress test in the now quite traditional individual bank by bank sense. It is a market-wide test designed to simulate shocks – it’s a flow test, designed to find obstructions and concentrations of risks and correlated positions that might otherwise be opaque. It is I think an important step forward in testing behavioural reactions to stress including how risks might cascade across markets. And, it will give us a better answer in terms of the effectiveness of CCPs in managing market-wide risks. The results should be published by the end of the year. It’s the sort of new thing that I think Mike would have appreciated, and been enthusiastic about.

    The Bank of England and the CFTC have a longstanding relationship of cooperation on CCPs. Mike added his special qualities to that relationship. Its our duty to carry his work forward, but even more so to do it in his spirit, the one we enjoyed and miss so much.

    Thank you.

    I would like to thank Sarah Breeden, Karen Jude, Harsh Mehta, Ruth Smith, Sam Woods, Shane Scott, Sasha Mills, Deborah Potts, Thomas Ferry, Konstantina Drakouli, Marc Ledroux, Barry King and Priya Mistry for their help in the preparation of these remarks.

    MIL OSI Economics –

  • MIL-OSI Economics: Risk reduction redefined: How compromise assessment helps strengthen cyberdefenses

    Source: Securelist – Kaspersky

    Headline: Risk reduction redefined: How compromise assessment helps strengthen cyberdefenses

    Introduction

    Organizations often rely on a layered defense strategy, yet breaches still occur, slipping past multiple levels of protection unnoticed. This is where compromise assessment enters the game. The primary objective of these services is risk reduction. They help discover active cyberattacks as well as unnoticed sophisticated attacks that occurred in the past by doing the following:

    • Tool-assisted scanning of all endpoints;
    • Host and network equipment log analysis;
    • Threat intelligence analysis, including darknet search;
    • Initial incident response to contain discovered threats.

    In this article, we delve into the root causes of real-world cases from our practice, where despite having numerous security controls in place, the organizations still found themselves compromised. In all the cases in question, compromise assessment was the last line of defense that successfully detected incidents.

    Patch management issues

    The vulnerability patching process typically takes time for a variety of reasons: from actual patch release all the way to identifying vulnerable assets and “properly” patching them, considering any pre-existing asset inventory and whether the accountable personnel will learn about the vulnerability in time. There are multiple factors that may delay this process, including formality in business continuity requirements, e.g. inability to reboot the server without a downtime window.

    That’s why insufficient patch management processes on the customer side are one of the most common root causes of incidents we observe in compromise assessment projects. Moreover, exploitation of a public-facing application was the root cause in 42.37% of cases investigated by the Kaspersky Global Emergency Response Team (GERT) in 2023.

    During the investigation of one case, we identified that the web server was patched a month after the attacker infiltrated the network: this delay was a treasure trove for the threat actor, since the organization was left unprotected and the attack went unnoticed.

    • Immediately after compromising the server, the attacker deployed a SILENTTRINITY C2 stager.
    • They attempted to dump credentials via a custom packed version of Mimikatz on the first day, and by dumping the LSASS process memory to disk on the fourth day.
    • During that month, they conducted internal reconnaissance of SMB shares until they obtained the credentials of the domain administrator.

    Policy violations by employees

    Most organizations focus on external threats; however, policy violations pose a major risk, with 51% of SMB incidents and 43% of enterprise incidents involving IT security policy violations caused by employees. An “employee” here is any person who has a regular employee’s level of access to the organization’s systems.

    In one of our compromise assessments, we identified an incident whose root cause was traced to a contracted cybersecurity consultant. During an interim report meeting, we presented a list of compromised accounts (a result of darknet search playbook execution) to the customer’s board of directors along with statistics on the accounts on the list. Of all the compromised accounts, 71% belonged to the customer’s employees, with 63% of these being employees’ accounts in the services accessible from outside the company.

    Statistics on the organization’s compromised accounts. Source: Kaspersky Digital Footprint Intelligence

    The list contained a C-level officer’s account, among others. Since this was a critical situation, with everyone suspecting that officer’s laptop had been compromised, we ran a quick investigation during the meeting and figured out that credentials had been leaked from a third-party consultant’s machine. The chairman created an account in an external system with his own corporate email and shared the credentials with the consultant. Since it was clear that consultant’s laptop might contain other confidential data, we developed the following tactical response plan.

    1. Collect a forensic triage package from the consultant’s laptop.
      • Analyze the package to identify all leaked credentials.
      • Check the consultant’s laptop for malware.
      • Run a keyword-based search to identify potential leaked documents.
    2. Review email/VPN/other logs of likely affected services available from outside the organization to detect any abnormal activity by compromised accounts.
    3. Double-check if multi-factor authentication was enabled for the compromised accounts at the time of compromise.
    4. Update the incident response plan based on the findings. Reset the password and install a new OS image on the laptop at a minimum.

    This incident could have been prevented by ensuring that employees and any third party with access to the network followed the policies. This is easy to say but it sometimes gets tricky and requires time, effort and deep technical knowledge in practice.

    MSP/MSSP issues

    Usually, MSSPs are more focused on continuous monitoring and alerting, ignoring detection gaps identification and visibility enhancements: a periodic review of the customer’s event audit policy, enabling a disabled log source or highlighting a poorly configured log source. For example, the X-Forwarded-For HTTP header is often not enabled on web servers. As a result, the SOC can’t see the original IP of the connection and determine the attack source, which complicates incident investigation.

    In our compromise assessment practice, we frequently identify incidents that external SOCs have missed. During one project, we reviewed third-party antivirus logs and identified multiple webshell detections on the same server for several days.

    Day from first exploit attempt File path Verdict Message
    Day 1 C:Windows[redacte
    d for privacy].aspx    		 Backdoor.ASP.WEBS
    HELL.SM    		 Malicious software deleted
    successfully
    Day 2 C:Windows[redacte
    d for privacy].aspx    		 Backdoor.ASP.WEBS
    HELL.SM    		 Malicious software deleted
    successfully
    Day 3 C:Windows[redacte
    d for privacy].aspx    		 Backdoor.ASP.WEBS
    HELL.SM    		 Malicious software deleted
    successfully
    Day 4 C:Windows[redacte
    d for privacy].aspx    		 Backdoor.ASP.WEBS
    HELL.SM    		 Malicious software deleted
    successfully
    Day 7 C:Program FilesCommon
    Filesmicrosoft sharedWeb
    Server
    Extensions16TEMPLATELA
    YOUTS[redacted for
    privacy].aspx    		 Backdoor.ASP.WEBS
    HELL.SM    		 Malicious software
    deleted successfully
    Day 9 C:Windows[redacte
    d for privacy].aspx    		 Backdoor.ASP.WEBS
    HELL.SM    		 Malicious software deleted
    successfully

    The MSSP SOC analysts had failed to raise an alert, because the malware was deleted by the antivirus each time. This is a textbook example of a junior’s mistake. If a motivated adversary has access to the server via a vulnerability, they would try a range of techniques and tactics to try to bypass security. This is where the human analyst’s attention is needed to add an additional layer of protection and prevent this from happening.

    This was exactly our case: the Kaspersky experts initiated deep forensic analysis and found out that the attacker tried different webshells over a few weeks. They finally found one that was not detectable by the AV vendor at the time, so they were able to get into the network. Further investigation revealed that the entire domain remained compromised for several months.

    Monitoring and verifying the quality of service from your MSP or MSSP is often challenging. Contractual agreements typically prevent clients from accessing the provider’s internal systems for a thorough review. Additionally, customers may lack the technical expertise or time required to oversee every action taken by their subcontractors.

    MSPs and subcontractors might not have enough cybersecurity awareness, which poses a challenge, where they might inadvertently expose the network to a cybersecurity risk by misconfiguring some security control or not following the best practice.

    Incomplete incident response

    Post-breach eradication of a threat actor requires planning of multiple actions to ensure complete removal of the attacker from the network or systems:

    • Removal of malware, scripts, tools, and backdoors installed by the attacker.
    • Changing the passwords for the compromised accounts and deleting any unauthorized service accounts that attackers might have created
    • Rolling back system configurations that might increase the attack surface or introduce new vulnerabilities

    Even after the malware is deleted, certain forensic artifacts remain in the system. Therefore, it is common to identify past attacks during compromise assessment. Intentional misconfiguration introduced by an attacker is a rarer case, but we occasionally find that enterprise incident response teams fail to eradicate these procedures.

    As part of the Active Directory configuration review playbook, Kaspersky analysts identified a Group Policy with several suspicious properties.

    1. A modification to the AllowReversiblePasswordEncryption property of each AD account, which made domain controllers store passwords in decryptable form (without using the one-way hash function). This configuration would enable the attacker to dump credentials in plaintext via attacks like DCSync.
    2. Disabling the audit of operations related to Kerberos Tickets. This configuration would hide attacker logons on all endpoints managed via Active Directory.

    False sense of security

    It’s crucial to remember that the effectiveness of even top-tier products is at its highest when these are properly installed, configured, and integrated. Without proper configuration, organizations cannot fully harness the potential of their cybersecurity solutions, which hinders their ability to create a robust defense.

    In our compromise assessment practice, we have witnessed several cases, listed below, which were detected because specialized scanners were deployed alongside an existing AV/EDR solution, providing a second layer of detection capabilities.

    • Absence of detection rules. The customer’s antivirus was unable to detect a pivotnacci webshell because the vendor did not have a defined detection rule.
    • Outdated malware signatures. The client antivirus was unable to detect malware because the network port listening to the central update server was blocked by a firewall, preventing the antivirus from receiving the latest updates.
    • Shadow IT. The customer’s antivirus was not deployed on certain servers because those servers were not part of Active Directory, which left them unprotected.

    Conclusion

    Compromise assessment has proven to be an indispensable component in the broader cybersecurity strategy of these organizations. The cases discussed above underscore that no security measure, no matter how advanced, is entirely foolproof. From internal policy violations to patch management failures and overlooked misconfigurations by third-party service providers, the risks are manifold and often hidden in plain sight. These examples highlight that a false sense of security can be more dangerous than no security at all, as it leaves organizations vulnerable to threats that might have otherwise been detected with thorough, periodic assessments.

    By integrating compromise assessment into the security framework, organizations can uncover these hidden threats, address vulnerabilities that slip through the cracks, and ultimately strengthen their overall security posture. In a world where cyberthreats are constantly evolving, the proactive identification and mitigation of potential compromises is not just advisable but also necessary. This approach ensures that organizations are not only reacting to breaches but are continuously verifying the effectiveness of their defenses, thereby reducing the risk of undetected compromises and safeguarding their assets more effectively.

    MIL OSI Economics –

  • MIL-OSI Economics: New Azure OpenAI Service updates enable companies to deploy and optimize AI models at scale

    Source: Microsoft

    Headline: New Azure OpenAI Service updates enable companies to deploy and optimize AI models at scale

    With the new enhancements to Azure OpenAI Service Provisioned offering, we are taking a big step forward in making AI accessible and enterprise-ready.

    In today’s fast-evolving digital landscape, enterprises need more than just powerful AI models—they need AI solutions that are adaptable, reliable, and scalable. With upcoming availability of Data Zones and new enhancements to Provisioned offering in Azure OpenAI Service, we are taking a big step forward in making AI broadly available and also enterprise-ready. These features represent a fundamental shift in how organizations can deploy, manage, and optimize generative AI models.

    With the launch of Azure OpenAI Service Data Zones in the European Union and the United States, enterprises can now scale their AI workloads with even greater ease while maintaining compliance with regional data residency requirements. Historically, variances in model-region availability forced customers to manage multiple resources, often slowing down development and complicating operations. Azure OpenAI Service Data Zones can remove that friction by offering flexible, multi-regional data processing while ensuring data is processed and stored within the selected data boundary.

    This is a compliance win which also allows businesses to seamlessly scale their AI operations across regions, optimizing for both performance and reliability without having to navigate the complexities of managing traffic across disparate systems.

    Leya, a tech startup building genAI platform for legal professionals, has been exploring Data Zones deployment option.

    “Azure OpenAI Service Data Zones deployment option offers Leya a cost-efficient way to securely scale AI applications to thousands of lawyers, ensuring compliance and top performance. It helps us achieve better customer quality and control, with rapid access to the latest Azure OpenAI innovations.“—Sigge Labor, CTO, Leya

    Data Zones will be available for both Standard (PayGo) and Provisioned offerings, starting this week on November 1, 2024.

    Industry leading performance

    Enterprises depend on predictability, especially when deploying mission-critical applications. That’s why we’re introducing a 99% latency service level agreement for token generation. This latency SLA ensures that tokens are generated at a faster and more consistent speeds, especially at high volumes

    The Provisioned offer provides predictable performance for your application. Whether you’re in e-commerce, healthcare, or financial services, the ability to depend on low-latency and high-reliability AI infrastructure translates directly to better customer experiences and more efficient operations.

    Lowering the cost of getting started

    To make it easier to test, scale, and manage, we are reducing hourly pricing for Provisioned Global and Provisioned Data Zone deployments starting November 1, 2024. This reduction in cost ensures that our customers can benefit from these new features without the burden of high expenses. Provisioned offering continues to offer discounts for monthly and annual commitments.

    Deployment option Hourly PTU One month reservation per PTU One year reservation per PTU
    Provisioned Global Current: $2.00 per hour
    November 1, 2024: $1.00 per hour    		 $260 per month   $221 per month
    Provisioned Data ZoneNew   November 1, 2024: $1.10 per hour   $260 per month $221 per month

    We are also reducing deployment minimum entry points for Provisioned Global deployment by 70% and scaling increments by up to 90%, lowering the barrier for businesses to get started with Provisioned offering earlier in their development lifecycle.

    Deployment quantity minimums and increments for Provisioned offering

    Model Global Data Zone New Regional
    GPT-4o Min: 50 15
    Increment 50 5    		 Min: 15
    Increment 5    		 Min: 50
    Increment 50
    GPT-4o-mini Min: 25 15
    Increment: 25 5    		 Min: 15
    Increment 5    		 Min: 25
    Increment: 25

    For developers and IT teams, this means faster time-to-deployment and less friction when transitioning from Standard to Provisioned offering. As businesses grow, these simple transitions become vital to maintaining agility while scaling AI applications globally.

    Efficiency through caching: A game-changer for high-volume applications

    Another new feature is Prompt Caching, which offers cheaper and faster inference for repetitive API requests. Cached tokens are 50% off for Standard. For applications that frequently send the same system prompts and instructions, this improvement provides a significant cost and performance advantage.

    By caching prompts, organizations can maximize their throughput without needing to reprocess identical requests repeatedly, all while reducing costs. This is particularly beneficial for high-traffic environments, where even slight performance boosts can translate into tangible business gains.

    A new era of model flexibility and performance

    One of the key benefits of the Provisioned offering is that it is flexible, with one simple hourly, monthly, and yearly price that applies to all available models. We’ve also heard your feedback that it is difficult to understand how many tokens per minute (TPM) you get for each model on Provisioned deployments. We now provide a simplified view of the number of input and output tokens per minute for each Provisioned deployment. Customers no longer need to rely on detailed conversion tables or calculators. 

    We are maintaining the flexibility that customers love with the Provisioned offering. With monthly and annual commitments you can still change the model and version—like GPT-4o and GPT-4o-mini—within the reservation period without losing any discount. This agility allows businesses to experiment, iterate, and evolve their AI deployments without incurring unnecessary costs or having to restructure their infrastructure.

    Enterprise readiness in action

    Azure OpenAI’s continuous innovations aren’t just theoretical; they’re already delivering results in various industries. For instance, companies like AT&T, H&R Block, Mercedes, and more are using Azure OpenAI Service not just as a tool, but as a transformational asset that reshapes how they operate and engage with customers.

    Beyond models: The enterprise-grade promise

    It’s clear that the future of AI is about much more than just offering the latest models. While powerful models like GPT-4o and GPT-4o-mini provide the foundation, it’s the supporting infrastructure—such as Provisioned offering, Data Zones deployment option, SLAs, caching, and simplified deployment flows—that truly make Azure OpenAI Service enterprise-ready.

    Microsoft’s vision is to provide not only cutting-edge AI models but also the enterprise-grade tools and support that allow businesses to scale these models confidently, securely, and cost-effectively. From enabling low-latency, high-reliability deployments to offering flexible and simplified infrastructure, Azure OpenAI Service empowers enterprises to fully embrace the future of AI-driven innovation.

    Get started today

    As the AI landscape continues to evolve, the need for scalable, flexible, and reliable AI solutions becomes even more critical for enterprise success. With the latest enhancements to Azure OpenAI Service, Microsoft is delivering on that promise—giving customers not just access to world-class AI models, but the tools and infrastructure to operationalize them at scale.

    Now is the time for businesses to unlock the full potential of generative AI with Azure, moving beyond experimentation into real-world, enterprise-grade applications that drive measurable outcomes. Whether you’re scaling a virtual assistant, developing real-time voice applications, or transforming customer service with AI, Azure OpenAI Service provides the enterprise-ready platform you need to innovate and grow.

    Start today with Azure OpenAI Service

    MIL OSI Economics –

  • MIL-OSI Economics: Trade finance resilience and low credit risk persist amid global challenges, confirms ICC 

    Source: International Chamber of Commerce

    Headline: Trade finance resilience and low credit risk persist amid global challenges, confirms ICC 

    The International Chamber of Commerce (ICC), along with partners Global Credit Data (GCD) and Boston Consulting Group (BCG), has released its 2024 Trade Register Report, reaffirming the resilience of trade finance instruments and the continued low credit risk across products despite ongoing geopolitical and economic challenges . 

    The 2024 report confirms that trade, supply chain and export finance continue to exhibit low risk, with default rates remaining low across all regions and asset classes overall. When defaults do occur, they are generally idiosyncratic, stemming from well-known commercial, geopolitical or macroeconomic factors. As global trade faces ongoing geopolitical and economic pressures, these financial products continue to serve as vital tools for mitigating risk and maintaining liquidity, supporting the stability of trade flows. 

    The ICC Trade Register remains the leading, authoritative global source on credit risk and broader market dynamics in trade and supply chain finance. Its data set represents nearly a quarter of all global trade finance transactions. This 2024 edition includes extended market insights and data on global trade and trade finance. New features include insights from ICC and BCG’s practitioner survey on key trends and opportunities in trade and supply chain finance as well as a comprehensive data pack with analysis on credit risk in trade finance, available for member banks or for separate purchase through ICC.  

    This year, ICC and GCD demonstrated the value of high-quality, representative data in shaping trade finance regulations through their contributions to emerging regulation on Basel III capital treatment. Krishan Ramadurai, outgoing Chair of the ICC Trade Register Project, encourages more banks to participate in the project and says that more data will only reinforce the point that trade finance is a low default asset class.  

    The ICC Trade Register continues to look beyond credit risk, with detailed analysis on market trends and competitive dynamics across the trade and supply chain finance market.  

    Ravi Hanspal, Partner at BCG, said: 

    “Despite ongoing headwinds, we are seeing the trade and supply chain finance market continue to evolve rapidly. Banks are observing that customers are now prioritising leading service and digital capabilities more than ever, driving a step-change in investment by banks in technology to accelerate seamless trade.” 

    Marilyn Blattner-Hoyle, Global Head of Trade Finance and Working Capital Solutions at Swiss Reinsurance Company, said:  

    “ICC’s Trade Register and its deep data over many cycles is perhaps the most critical publication in the trade industry. The Register’s role in sharing quantitative and qualitative statistics underpins the power of trade as well as the stability of trade-related credit risks. It helps us to get comfortable insuring more trade with our bank clients, thus making trade and the world more resilient together. We use the Register in our actuarial assessments as well as our internal/external advocacy. We are proud to be the first insurance sponsor of the publication, affirming the important role of insurance in the global trade ecosystem.” 

    Christian Hausherr, Product Manager for SCF at Deutsche Bank and member of ICC Trade Register Steering Committee, said:  

    “In its thirteenth year after being established, the ICC Trade Register proves its relevance and importance to the trade finance community. Since then, the data approach as well as the scope of the Trade Register have been materially enhanced by the team managing the publication process on an annual basis. As of today, the Trade Register offers unique insights not only into trade finance risk, but also provides valuable macro-economic insights to its readers.” 

    ICC Policy Manager Tomasch Kubiak thanks member banks for their ongoing contributions.

    “ICC is very appreciative of all the efforts member banks are putting in yet again for an enhanced version of the ICC Trade Register. This year’s project provides a full insight into meaningful trends in global trade finance as well as complete data collected from our members, which is now available on demand,”  

    he said.

    Read or purchase the full ICC Trade Register Report. 

    MIL OSI Economics –

  • MIL-OSI Economics: Mission Index Focuses Help Where It’s Needed

    Source: Fannie Mae

    Fannie Mae’s and Freddie Mac’s (the Enterprises) Mission Index disclosures provide insights into mission-oriented lending activities underlying our Single-Family mortgage-backed securities (MBS) — helping meet specific portfolio needs and informing investment strategy. The disclosure was designed in response to investors’ increased interest in allocating capital to support affordable housing and provide access to credit for underserved borrowers and markets. Since the first version of the Mission Index was introduced two years ago, it has evolved based on investor feedback and is now the foundation of the Enterprises’ Single-Family Social Bond programs. We’ve also introduced a new disclosure supplement, the Mission Index Criteria Attribution (MICA), to further support investors in their impact analysis.

    Our Mission Through Disclosures

    The Enterprises support liquidity, stability, and affordability in the U.S. housing finance market. We work especially hard to ensure that includes support for mortgage credit to moderate- and low-income families and underserved areas. The Mission Index helps to highlight these activities. In summary, it’s a disclosure designed as two aggregate measures per MBS pool. The first measure helps investors understand how many loans in a pool finance a property to borrowers meeting certain income, borrower, and property dimensions. The second measure illustrates how many of those loans meet multiple mission criteria. These measures are aggregated by design to minimize disruption to Uniform Mortgage-Backed Securities (UMBS) in the “to be announced” (TBA) market and to deliver transparency to investors while protecting borrower privacy.

    Market Reception

    The Mission Index has been well received by both impact-focused investors and by value-focused investors. That is because, in addition to providing more information on the social characteristics of the borrowers underlying a pool, many of the criteria that comprise the Mission Index are historically correlated with slower prepayments, or call protection. As a result, both impact and non-impact investors alike have expressed interest in these new disclosures. Some of this interest has been expressed through pay-ups, meaning investors find value in MBS pools with high Mission Index scores and are willing to pay more for them than the typical TBA security. This demand, and the pay-ups received by lenders who originate these loans, are designed to help incentivize more mission-oriented mortgage financing.

    Single-Family Social Bonds

    Our Single-Family Social Bonds, or MBS, launched in the first half of this year, are designed to satisfy international standards and are bolstered by independent second party opinions. And the Mission Index is the foundation of the program. MBS pools with 100% of their loans having at least one mission-focused attribute and an average of at least two of the three high-level attributes (i.e., income, borrower, or property) per loan now receive a Social Bond label.  When the Enterprises pool whole loans purchased from lenders that meet the criteria for our Single-Family Social Bond labels into an MBS and sell that MBS with a pay-up, the programs are designed to support more mission lending. Specifically, the Enterprises plan to allocate incremental funds they receive from pay-ups for Single-Family Social MBS to incent lenders to prioritize these types of loans, while any surplus revenue are expected to support mission lending programs, such as our Duty to Serve plans.

    Bolstering Impact Analysis

    Recently, Fannie Mae published a MICA disclosure supplement and Freddie Mac expects to release its MICA soon. These supplements are designed with the impact-focused investor in mind and seek to help respond to more detailed questions about how an investor’s portfolio supports mission lending.

    The MICA provides cohort-level information about all MBS pools issued between January 2010 and February 2024 for Fannie Mae and between January 2010 and May 2024 for Freddie Mac under the original Mission Index Version 1. The MICA tells investors how common each attribute is among borrowers in securities issued by the Enterprises, with cohorts divided by issuance quarter, pool type, and the average number of mission-focused attributes for loans in the pool. This can provide valuable information about the types of borrowers receiving loans ultimately pooled into Enterprise MBS.

    What’s Next?

    Market feedback is key to the success of our programs. We’re excited to hear from investors on v1.0 of the MICA as we prepare to launch v1.1 in 2025, which will cover bonds issued under v1.1 of the Mission Index.

    We’re also focused on creating our first impact reports for our Single-Family Social Bond programs, helping investors to see the effectiveness of the money they are putting to work to support mission-oriented lending.

    To further aid in analysis, later this quarter we plan to update the Social Indicator disclosure for Fannie Megas, Freddie Giants, and Fannie and Freddie Supers to be disclosed as Yes if all the underlying security collateral have a Social Indicator of Yes.

    We look forward to continuing to use this disclosure to work with lenders and investors to serve the needs of households across the country.

    Learn More

    Dive into the Mission Index and new MICA Resources – including Fannie Mae’s excel-based tool where investors can load their portfolios to receive an estimate of impact.

    Review our Single-Family Social Bonds, including eligibility, disclosures, and expected impact reporting.

    The information contained in this blog post and in the documents that may be accessed through this blog post is provided for your general information only and speaks only as of the date of those documents. Numerous assumptions were used in preparing the information, which may or may not be reflected herein. As such, no assurance can be given as to the information’s accuracy, appropriateness or completeness in any particular context. The information could be out of date and no longer accurate. Freddie Mac and Fannie Mae undertake no obligation, and disclaim any duty, to update any of the information in those documents.  Opinions contained in this blog post are those of Freddie Mac and Fannie Mae as of the date of this blog post and are subject to change without notice.

    This is not an offer to buy or sell any Freddie Mac or Fannie Mae securities. Offers for any given security are made only through applicable offering circulars and related supplements, which incorporate the issuer’s most recent Annual Report on Form 10-K filed with the Securities and Exchange Commission (SEC); all other reports the issuer files with the SEC pursuant to Section 13(a) of the Securities Exchange Act of 1934 (Exchange Act), excluding any information “furnished” to the SEC on Form 8-K; and all documents that the issuer files with the SEC pursuant to Sections 13(a), 13(c) or 14 of the Exchange Act, excluding any information “furnished” to the SEC on Form 8-K.

    The financial and other information contained in this blog post is not incorporated by reference into, or a part of, any offering documents of any security. The information does not constitute a sufficient basis for making a decision with respect to the purchase and sale of any security and is directed only at, and is intended for distribution to and use by, qualified persons or entities in jurisdictions where such distribution and use is permitted and would not be contrary to law or regulation. All information regarding or relating to Freddie Mac or Fannie Mae securities is qualified in its entirety by the relevant offering circular and any related supplements. You should review the relevant offering circular and any related supplements before making a decision with respect to the purchase or sale of any security. In addition, before purchasing any security, please consult your legal and financial advisors for information about and analysis of the security, its risks and its suitability as an investment in your particular circumstances.

    These materials may contain forward-looking statements. Forward-looking statements involve known and unknown risks and uncertainties, some of which are beyond Freddie Mac’s control. Freddie Mac’s management’s expectations for the company’s future necessarily involve a number of assumptions, judgments and estimates and various factors could cause actual results to differ materially from the expectations expressed in these and other forward-looking statements. These assumptions, judgments, estimates and factors are discussed in Freddie Mac’s most recent Annual Report on Form 10-K and its reports on Form 10-Q and Form 8-K, which are available on the Investor Relations page of the company’s website at http://www.freddiemac.com/investors and the SEC’s website at www.sec.gov. Freddie Mac undertakes no obligation to update forward-looking statements it makes to reflect events or circumstances occurring after the date of this blog post.

    This discussion contains a number of expectations, beliefs and forward-looking statements, including statements regarding Fannie Mae’s business plans, strategies and activities and the impact of those plans, strategies and activities. These expectations, beliefs and other forward-looking statements are based on Fannie Mae’s current assumptions regarding numerous factors and are subject to change. Actual outcomes may differ materially from those reflected in these forward-looking statements due to a variety of factors, including, but not limited to, those described in “Forward-Looking Statements” and “Risk Factors” in Fannie Mae’s most recently filed Form 10-K and Form 10-Q. Any forward-looking statements made by Fannie Mae speak only as of the date on which they were made. Fannie Mae is under no obligation to, and expressly disclaims any obligation to, update or alter its forward-looking statements, whether as a result of new information, subsequent events, or otherwise.

    MIL OSI Economics –

  • MIL-OSI Economics: Samsung’s 14th Annual Day of Service: Employees Unite Nationwide for Community Impact

    Source: Samsung

    Samsung employees across the U.S. joined forces for the 14th annual Samsung Gives Day of Service, marking the season of giving —a time when people come together in generosity and support for those in need—with a full day dedicated to hands-on community service. This year, we offered more than 2,000 opportunities for employees to be engaged in their communities, both in-person and virtually, partnering with over 50 nonprofit and education organizations. Employees brought Samsung’s global mission, Together for Tomorrow, Enabling People, to life through various service activities that focused on critical areas such as STEM education, sustainability, accessibility, and diversity, equity, and inclusion (DEI).

    MIL OSI Economics –

  • MIL-OSI Economics: How Copilots are helping drive innovation to achieve business results that matter

    Source: Microsoft

    Headline: How Copilots are helping drive innovation to achieve business results that matter

    The pace of AI innovation today continues to be extraordinary, and at Microsoft we are focused on helping organizations embrace it. By providing our customers with the most advanced AI technology across every product we build — combined with our unparalleled partner ecosystem and co-innovation approach — we are helping them make real progress in ways that matter. I am proud to share over 100 customer stories from this quarter alone showing how we are helping customers accelerate AI Transformation — no matter where they are on their journey.

    Recently during the Microsoft AI Tour, I spoke with customers who shared ways they are adopting Copilots to empower human achievement, democratize intelligence and realize significant business value. I also discussed the concept of an AI-first business process and the differentiation you can drive when bringing together the power of Copilots and human ambition with the autonomous capabilities of an agent. I was inspired by the outcomes our customers have achieved through pragmatic innovation and the progress they are making to evolve the future of industry. I am pleased to share ten stories from the past quarter that illustrate how Copilots have yielded results for our customers, while highlighting AI Transformation experiences in their own words.

    Accenture and Avanade have a long history of helping customers implement cutting-edge solutions, with internal testing a key factor in their ability to deliver customizable Microsoft solutions with deep expertise. Putting Microsoft 365 Copilot into the hands of employees helped them realize ways to increase productivity, with 52% of employees seeing a positive impact on the quality of their work, 31% reporting less cognitive fatigue and 84% finding Copilot’s suggestions fair, respectful and non-biased. Accenture also piloted GitHub Copilot to help build better solutions faster with developers spending less time debugging, resulting in 95% of developers reporting they enjoyed coding more.

    “Using our extensive Microsoft technology expertise and practical learnings from our own experience implementing Microsoft 365 Copilot, our solutions empower clients to fully tap into Microsoft AI capabilities.”

    Veit Siegenheim, Global Future of Work Lead at Avanade

    Nigerian multinational financial services group Access Holdings Plc. serves more than 56 million customers across 18 countries. As the business grew and transitioned from a small bank to a major holding company, it adopted Microsoft 365 Copilot to address challenges in data management, meeting productivity and software development. With the integration of Copilot into daily tools, the company significantly enhanced efficiency and engagement across the business. Writing code now takes two hours instead of eight, chatbots can be launched in 10 days instead of three months and presentations can be prepared in 45 minutes instead of six hours. Copilot has also driven a 25% increase in staff engagement during meetings.

    “To inspire everyone in the organization to take advantage of AI, we knew we had to integrate AI into the tools people use every day. Microsoft 365 Copilot made the most sense and was a natural fit for us.”

    Lanre Bamisebi, Executive Director IT and Digitalization at Access Holdings, Plc.

    To improve resident services and reinvent customer engagement, the City of Burlington, Ontario, embraced AI and low-code tools to develop new online services that transform and automate internal processes. In just eight weeks, the city utilized Copilot Studio to develop and launch a custom copilot designed to help residents quickly find answers to frequently asked questions. The city also developed a portal that streamlines building permit reviews and enables customers to track the status of their own applications. As a result, the average time it takes to process a permit approval decreased from 15 weeks to 5-7 weeks, allowing more time for city employees to evaluate complex submissions.

    “Our staff and citizens do not have to worry about mundane tasks as much anymore. Now they’re able to have rich, collaborative conversations about how to creatively solve problems, making for a much more fulfilling and rewarding work and customer experience.”

    Chad MacDonald, Executive Director and Chief Information Officer at the City of Burlington

    Finastra empowers financial institutions with leading software for lending, payments, treasury, capital markets and universal banking. To transform its marketing processes, the company used Microsoft 365 Copilot to automate tasks, enhance content creation, improve analytics and personalize customer interactions. Since integrating Copilot, the team reduced time-to-market for campaigns from three months to less than one. Copilot also significantly reduced the time marketers spend generating and gathering insights from each campaign, with employees citing a 20%-50% time savings across tasks like full-funnel analysis, supply management analysis and budget management.

    “Copilot makes you more effective because you get better insights, and it makes you more efficient because you can produce results faster. It also makes work more meaningful and fun because your team can focus on what matters — strategy, creativity and everything that sets you apart from the competition.”

    Joerg Klueckmann, Head of Corporate Marketing and Communications at Finastra

    GoTo Group provides technology infrastructure and solutions across Indonesia. It is bending the curve on innovation by significantly enhancing productivity and code quality across its engineering teams by adopting GitHub Copilot. With real-time code suggestions, chat assistance and the ability to break down complex coding concepts, the company has saved over seven hours per week and achieved a 30% code acceptance rate within the first month. With 1,000 engineers already using GitHub Copilot, the tool allows them to innovate faster, reduce errors and focus more time on complex tasks to deliver greater value to their users.

    “GitHub Copilot has significantly reduced syntax errors and provided helpful autocomplete features, eliminating repetitive tasks and making coding more efficient. This has allowed me to focus on the more complex elements in building great software.”

    Nayana Hodi, Engineering Manager at GoTo Group

    South Africa’s Milpark Education faced operational challenges when shifting to online learning due to legacy systems slowing down student interactions and support. Through close collaboration with Enterprisecloud, Milpark migrated its back-office infrastructure to Azure within three months, replacing its legacy student admissions system with an extensible, integrated digital platform powered by technologies such as Microsoft Copilot and Copilot Studio. In just four months, the educational institution improved efficiency and accuracy of student support, decreasing the average resolution time by 50% and escalations by more than 30%.

    “Using Copilot, agents are now able to use generative AI to rapidly get up to speed on case details and respond to students using standardized templates that help them provide more personalized and professional responses. The results speak for themselves.”

    Shaun Dale, Managing Director at Enterprisecloud

    For over two decades, Teladoc Health has been offering a broad spectrum of services to patients using virtual care services — from primary care to chronic condition management. After the rapid growth of telehealth adoption post-pandemic, operational efficiency was instrumental in managing internal processes and external client interactions. By deploying Microsoft 365 Copilot and using Copilot in Power Automate, the company has reshaped business processes to help employees realize greater time savings while enhancing the client experience. The Copilots and agents helped employees save five hours per week and thousands of enterprise hours annually by eliminating mundane daily processes and fostering better cross-department communications, while also helping new employees get set up to run their workflows 20% faster.

    “Copilot is changing the way we work. It’s not just about saving time; it’s about enhancing the quality of our work, allowing us to focus on what truly matters: delivering exceptional care to our members.” 

    Heather Underhill, SVP Client Experience & Operations at Teladoc Health

    International energy company Uniper adopted a single-cloud strategy with Azure as its foundation to drive rapid AI innovation. To help its employees focus on using core competencies, the company implemented Microsoft 365 Copilot to reduce time spent on manual and repetitive tasks, and help workers focus on more pressing work, such as developing enhanced solutions to speed up the energy transition. Its in-house auditors have already increased productivity by 80% by using Copilot to create plans and checklists. Uniper is also using Copilot for Security to help identify risks twice as fast and take appropriate action sooner.

    “As an operator of critical infrastructure, we have to contend with a growing number of reports of phishing and attacks by hackers. AI can help us implement a sensible way of managing the sheer number of threats.”

    Damian Bunyan, CIO at Uniper

    British telecommunications company Vodafone has transformed its workplace productivity with Microsoft 365 Copilot, already seeing strong ROI from its adoption. In early trials, Copilot saved employees an average of three hours per week by using the tool to draft emails, summarize meetings and search for information. Copilot is also enriching the employee experience, with 90% of users reporting they are eager to continue using Copilot and 60% citing improved work quality. For Vodafone’s legal and compliance team, Copilot has significantly accelerated the processes of drafting new contracts, reducing the time required to complete this work by one hour. As a result of these efficiency gains, Vodafone is rolling out Copilot to 68,000 employees.

    “Our AI journey is focusing on three areas: operational efficiency inside the organization; rewiring the business to provide an enhanced customer experience; and unlocking growth opportunities through new products and services that we can create around generative AI. Copilot will help drive all three.”

    Scott Petty, Chief Technology Officer at Vodafone

    Wallenius Wilhelmsen, a global leader in roll-on/roll-off shipping and vehicle logistics, is empowering better decision-making while fostering a culture of innovation and inclusion with AI tools. After participating in an early access program, the company broadly adopted Microsoft Copilot 365 to help streamline processes, enhance data management and improve communication across its 28 countries. To help strengthen Copilot immersion and realize value faster, they introduced a seven-week Microsoft Viva campaign to teach, communicate and measure Copilot adoption. The campaign resulted in 80% of employees using Copilot, with some teams realizing time savings of at least 30 minutes per day. The company also uses Copilot Dashboard to manage usage and gather user feedback, helping demonstrate ROI and measure results outside of time savings alone.

    “Copilot changes the way we think and work while keeping us curious and open to embracing opportunities. I think that is the sort of benefit that is not so measurable, but important. So, my time management and structured approach to my everyday work life has been enhanced with Copilot and Viva.”

    Martin Hvatum, Senior Global Cash Manager at Wallenius Wilhelmsen

    I believe that no other company has a better foundation to facilitate your AI Transformation than Microsoft. As we look ahead to Microsoft Ignite, I am excited by the latest innovation we will announce as a company, and the customer and partner experiences we will share. We remain committed to driving innovation that creates value in ways that matter most to our customers, and believe we are at our best when we serve others. There has never been a better opportunity for us to accomplish our mission of empowering every person and every organization on the planet to achieve more than now, and I look forward to the ways we will partner together to help you achieve more with AI.

    AI Customer Stories from FY25 Q1

    Accelleron: Accelleron turbocharges IT support solutions and resolution times with Power Platform

    Agnostic Intelligence: Agnostic Intelligence transforms risk management with Azure OpenAI Service, achieving up to 80% time savings

    Alaska Airlines: How Alaska Airlines uses technology to ensure its passengers have a seamless journey from ticket purchase to baggage pickup

    Allgeier: Allgeier empowers organizations to own and expand data operations

    ANZ Group: ANZ launches first-of-its-kind AI Immersion Centre in partnership with Microsoft

    Asahi Europe & International: Asahi Europe & International charts new paths in employee productivity with Microsoft Copilot

    Auburn University: Auburn University empowers thousands of students, faculty and staff to explore new ways of using AI with Microsoft Copilot

    Avanade: Avanade equips 10,000 employees with Microsoft Fabric skills to help customers become AI-driven and future-ready

    Azerbaijan Airlines: Azerbaijan Airlines expands data access to increase efficiency by 70% with Microsoft Dynamics 365

    Aztec Group: Aztec Group uses Copilot for Microsoft 365 to enhance the client experience whilst powering efficiencies

    Bader Sultan: Bader Sultan uses Microsoft Copilot to boost productivity and serve clients faster

    BaptistCare: BaptistCare supports aging Australians and tackles workforce shortages through Microsoft 365 Copilot

    Barbeque Mania!: Barbecue Mania! centralizes your data with Microsoft Azure and saves $3.5 million over 5 years

    Bank of Montreal: Bank of Montreal reduces costs by 30% with Azure

    BlackRock: How BlackRock’s ‘flight crew’ helped Copilot for Microsoft 365 take off

    Capita: Capita uses GitHub Copilot to free developers and deliver faster for customers

    Cassidy: Cassidy and Azure OpenAI Service: Making AI simple for all

    Cdiscount: Cdiscount, Azure OpenAI Service and GitHub Copilot join forces for e-commerce

    Celebal: Celebal drives custom business transformations with Microsoft Fabric

    Chalhoub Group: Chalhoub Group’s People Analytics team speeds reporting with Microsoft Fabric

    ClearBank: ClearBank processes 20 million payments a month — up from 8,000 — with platform built on Azure

    Cloud Services: Faster with Fabric: Cloud Services breaks new ground with Microsoft

    Coles Supermarkets: Coles Supermarkets embraces AI, cloud applications in 500-plus stores with Azure Stack HCI​

    Commercial Bank of Dubai: Commercial Bank of Dubai: innovating a future proof banking platform with Microsoft Azure

    CPFL: CPFL expands its data repository by 1500% with Mega Lake project on Microsoft Azure

    Cummins: Cummins uses Microsoft Purview to automate information governance more efficiently in the age of AI

    Dubai Electricity and Water Authority (DEWA): DEWA pioneers the use of Azure AI Services in delivering utility services

    Digi Rogaland: Digi Rogaland prioritizes student safety with Bouvet and Microsoft Fabric

    Eastman: Eastman catalyzes cybersecurity defenses with Copilot for Security

    E.ON: A modern workspace in transition: E.ON relies on generative AI to manage data floods with Copilot for Microsoft 365

    EPAM Systems: Efficiency inside and out: EPAM streamlines communications for teams and clients with Copilot for Microsoft 365

    EY: EY redefines sustainability performance management with Microsoft

    Fast Shop: Fast Shop consolidated its data platform on Microsoft Azure and is now ready for the era of AI

    FIDO Tech: AI tool uses sound to pinpoint leaky pipes, saving precious drinking water

    Florida Crystals Corporation: Telecom expenses for Florida Crystals dropped 78% with Teams Phone and Teams Rooms

    Four Agency: Four Agency innovates with Microsoft 365 Copilot to deliver better work faster

    Fractal: Fractal builds innovative retail and consumer goods solutions with Microsoft’s AI offerings including Azure OpenAI Service

    GE Aerospace: GE Aerospace launches company-wide generative AI platform for employees

    Georgia Tech Institute for Data Engineering and Science: Georgia Tech is accelerating the future of electric vehicles using Azure OpenAI Service

    Hitachi Solutions: Hitachi Solutions transforms internal operations with Microsoft Fabric

    IBM Consulting: How IBM Consulting drives AI-powered innovation with Fabric expertise

    iLink Digital: Transforming user-driven analytics with Microsoft Fabric

    Insight Enterprises: Insight Enterprises achieves 93% Microsoft Copilot use rate, streamlining business operations to pave the way for customer success

    Intesa Sanpaolo: Intesa Sanpaolo accrues big cybersecurity dividends with Microsoft Sentinel, Copilot for Security

    ITOCHU Corporation: ITOCHU uses Microsoft Fabric and Azure AI Studio to evolve its data analytics dashboard into a service delivering instant recommendations

    IU International University of Applied Sciences (IU): IU revolutionizes learning for its students with the AI study buddy Syntea and Azure OpenAI Service

    John Cockerill: John Cockerill engages pro developers to build enterprise-wide apps with Power Platform

    Kaya Limited: Kaya Limited elevates customer experience and operational efficiency with Microsoft Dynamics 365 and Power BI

    LexisNexis: LexisNexis elevates legal work with AI using Copilot for Microsoft 365

    Lionbridge: Lionbridge disrupts localization industry using Azure OpenAI Service and reduces turnaround times by up to 30%

    Lotte Hotels & Resorts: Hotelier becomes a citizen developer, building a smart work culture based on Power Platform and hyper-automated work environment

    Lumen Technologies: Microsoft and Lumen Technologies partner to power the future of AI and enable digital transformation to benefit hundreds of millions of customers

    LS ELECTRIC: LS ELECTRIC uses data to optimize power consumption with Sight Machine and Microsoft Cloud for Manufacturing

    MAIRE: MAIRE, transforming the energy sector and an entire company culture with Microsoft 365 Copilot

    Mandelbulb Technologies: Early-adopter Mandelbulb Technologies finds success with Fabric

    McKnight Foundation: McKnight Foundation accelerates its mission and supports community partners with Microsoft 365 Copilot

    MISO: MISO undergoes a digital transformation with Microsoft Industry Solutions Delivery

    Mitsubishi Heavy Industries (MHI): Recognizing the essence of AI and building the future with clients: MHI’s DI to create proprietary architecture using Azure OpenAI Service

    Molslinjen: Molslinjen develops an AI-powered dynamic pricing strategy with Azure Databricks

    National Australia Bank: National Australia Bank invests in an efficient, cloud-managed future with Windows 11 Enterprise

    Nagel-Group: Works agreements and contracts: Nagel-Group uses Azure OpenAI Service to help employees find information

    NC Fusion: Elevating experiences with AI, from productivity to personalization

    National Football League Players Association: The National Football League Players Association and Xoriant use Azure AI Services to provide protection to players across 32 teams

    Northwestern Medicine: Northwestern Medicine deploys DAX Copilot embedded in Epic within its enterprise to improve patient and physician experiences

    Oncoclínicas: Oncoclínicas creates web portal and mobile app to store clinical and medical procedures with Azure Cognitive Services

    PA Consulting: PA Consulting saves hours a week with Copilot for Microsoft 365 and Copilot for Sales

    Parexel: Parexel speeds operational insights by 70% using Microsoft Azure, accelerating data product delivery and reducing manual work

    Petrochemical Industries Company (PIC): From weeks to days, hours to seconds: PIC automates work processes to save time with Microsoft 365 Copilot

    PKSHA Technology: PKSHA leans on Copilot for Microsoft 365 as part of their team

    Planted: Planted combines economic growth and environmental sustainability — with Microsoft Azure OpenAI

    Profisee: Profisee eliminates data siloes within Microsoft Fabric

    Programa De Atención Domiciliaria: The Home Care Program in Panama helped more than 17,000 people with the power of Microsoft Power Automate

    PwC: PwC scales GenAI for enterprise with Microsoft Azure AI

    QNET: QNET increases security response efficiency 60 percent with Microsoft Security Solutions

    RTI International: Research nonprofit RTI International improves the human condition with Microsoft 365 Copilot

    Rijksmuseum: Rijksmuseum transforms how art lovers engage with the museum, with Dynamics 365

    Sandvik Coromant: Sandvik Coromant hones sales experience with Microsoft Copilot for Sales

    Share.Market: Share.Market redefines the investment experience with Microsoft Azure

    Simpson Associates: Simpson Associates spurs justice for at-risk communities with Azure AI

    Softchoice: Softchoice harnesses Microsoft Copilot and reduces content creation time by up to 70%, accelerating customer AI journeys with its experience

    Sonata Software: Sonata Software goes from early adopter to market leader with Fabric

    Swiss International Air Lines (SWISS): SWISS targets 30% cost savings, increased passenger satisfaction with Azure

    SymphonyAI: SymphonyAI is solving real problems across industries with Azure AI

    Syndigo: Syndigo accelerates digital commerce for its customers by more than 40% with Azure

    TAL: TAL and Microsoft join forces on strategic technology deal

    Tecnológico de Monterrey: Tecnológico de Monterrey university pioneers ambitious AI-powered learning ecosystem

    Telstra: Telstra and Microsoft expand strategic partnership to power Australia’s AI future

    The University of Sydney: The University of Sydney utilizes the power of Azure OpenAI to allow professors to create their own AI assistants

    Torfaen County Borough: Torfaen County Borough Council streamlines organizational support for Social Care using Copilot for Microsoft 365

    Trace3: Trace3 expands the realm of clients’ possibilities with Windows 11 Pro and Microsoft Copilot

    Unilever: Unilever is reinventing the fundamentals of research and development with Azure Quantum Elements

    University of Wisconsin: Microsoft collaborates with Mass General Brigham and University of Wisconsin–Madison to further advance AI foundation models for medical imaging

    Via: Marketplace, online support, and remote work: Via embraces the digital world supported by Microsoft 365, Dynamics 365 and Azure

    Virgin Atlantic: How Virgin Atlantic is flying higher with Copilot

    Virgin Money: Redi, set, go: Virgin Money delivers exceptional customer experiences with Microsoft Copilot Studio

    Visier: Visier achieves performance improvements of up to five times using Azure OpenAI Service

    World2Meet (W2M): World2Meet, the travel company providing a better customer experience and operations with a new virtual assistant powered by Microsoft Azure

    Xavier College: Xavier College begins a process of modernizing its student information systems on Dynamics 365 and AI, unlocking powerful insights

    ZEISS: More time for research: ZEISS supports businesses and researchers with ZEISS arivis Cloud based on Microsoft Azure

    ZF Friedrichshafen AG (ZF Group): ZF Group builds manufacturing efficiency with over 25,000 apps on Power Platform

    Tags: Azure, Azure AI Services, Azure Cognitive Services, Azure Databricks, Azure OpenAI Service, Azure Quantum Elements, Azure Stack HCI, Copilot, Copilot for Sales, Copilot for Security, Copilot Studio, Dax Copilot, GitHub Copilot, Microsoft 365, Microsoft 365 Copilot, Microsoft AI Tour, Microsoft Cloud for Manufacturing, Microsoft Dynamics 365, Microsoft Fabric, Microsoft Ignite, Microsoft Power Platform, Microsoft Sentinel, Microsoft Teams, Microsoft Viva, Power Automate,

    MIL OSI Economics –

  • MIL-OSI Economics: ICC and Palestine Emerging team up to foster sustainable prosperity in the Middle East

    Source: International Chamber of Commerce

    Headline: ICC and Palestine Emerging team up to foster sustainable prosperity in the Middle East

    In addition to causing devastating human losses in the region, the ongoing conflict in the Middle East has led to substantial negative economic consequences. Prior to the war, Palestine already had one of the lowest GDP per capitas in the region. Under the Palestine Emerging growth scenario, GDP can more than double to potentially reach US$36 billion by 2050, compared to US$19 billion for the base case. Palestine Emerging develops and validates ideas, turning them into detailed plans and investable projects.

    Formalising the partnership, ICC and Palestine Emerging committed to a set of joint initiatives aimed at growing the Palestinian economy, to the benefit of the Middle East region at large. These include training for Palestinian SMEs, building export capacity and promoting investment opportunities in Palestine. ICC and Palestine Emerging will also work together to identify opportunities to reduce trade barriers, accelerate dispute resolution and increase cross-border trade.

    Palestine Emerging Executive Director Shireen Shelleh said:

    More than just support, this Trade Gamechanger can reshape a key macroeconomic factor, to significantly accelerate the Palestinian economy. Our partnership with ICC, the global body for commerce, will help produce a step-change for economic development and cross-regional collaboration as we work to prepare more investable conditions in the West Bank and ultimately in Gaza.

    ICC Secretary General John W.H. Denton AO said:

    ICC is uniquely positioned to support the economic reconstruction and recovery of conflict-affected areas, leveraging the knowledge and know-how from across our global network. Our partnership with Palestine Emerging – which draws on unique contributions from regional and international actors – will advance our ultimate goal to enable business to support peace and prosperity for everyone, everywhere in line with our founding purpose.

    About Palestine Emerging

    Palestine Emerging is a pro-bono coalition of over 100 leaders and experts from Palestinian business leaders, international financial organisations and global economic development experts, coalesced around a robust economic blueprint of what needs to happen for Gaza and the West Bank to see substantial reconstruction and a sustainable road to prosperity and economic growth.

    MIL OSI Economics –

  • MIL-OSI Economics: Governor Signe Krogstrup’s speech at The International Center for Monetary and Banking Studies

    Source: Danmarks Nationalbank

    Exchange rates

    On 29 October 2024, Governor Signe Krogstrup gave a speech on capital flows and exchange rate management at The International Center for Monetary and Banking Studies in Geneva. The speech offered a practitioner’s view, originating from the Danish fixed exchange rate policy.

    MIL OSI Economics –

  • MIL-OSI Economics: Tenth Annual Richard Goode Lecture: International Lending in War and Peace

    Source: International Monetary Fund

    The International Monetary Fund will hold its tenth annual Richard Goode Lecture on November 5, 2024. The Richard Goode Lecture is an annual event hosted by the Fiscal Affairs Department for top academics to present their cutting-edge research on topical policy issues before a broad audience of policymakers, thinktanks, and staff of international organizations.

    The theme of this year’s seminar is “International Lending in War and Peace” presented by Professor Christoph Trebesch. The lecture will present some key trends in international capital flows across 200 years, focusing on turbulent episodes during war and peace. It will illustrate the crucial role of official finance in helping avert military defeat or financial collapse.

    Professor Trebesch is a professor at the Kiel Institute for the World Economy and the University of Kiel. His research focuses on international finance and macroeconomics as well as political economy and geopolitics. His research has been published in leading economic journals such as the American Economic Review, the Quarterly Journal of Economics, and the Journal of Political Economy and is regularly cited in international media, including The New York Times, the Financial Times, and the Wall Street Journal. He directs the CEPR Policy Network on “International Lending and Sovereign Debt” and co-directs the CEPR Network on “Geoeconomics,” for which he organizes an annual high-level conference on geopolitics and economics. He is also the creator of the widely referenced “Ukraine Support Tracker” on military and financial aid flows to Ukraine. In 2023, he was awarded an ERC Consolidator Grant, one of the most prestigious research recognitions in Europe.

    *Light refreshments will be served.

    Questions for the speaker can be sent before the event to FADRG@imf.org

    Agenda

    10:02 AM – 10:05 AM Welcoming remarks by Vitor Gaspar, Director, Fiscal Affairs Department
    10:05 AM – 10:50 AM Presentation by Professor Christoph Trebesch
    10:50 AM – 11:05 AM Conversation between Vitor Gaspar and Christoph Trebesch
    11:05 AM – 11:25 AM Audience Q&A

    MIL OSI Economics –

  • MIL-OSI Economics: Burundi: African Development Bank Group hosts training for project partners on social and environmental safeguards

    Source: African Development Bank Group
    As part of its commitment to building the capacity of its partners and improving the quality of project implementation, the African Development Bank Group organized a workshop on strengthening social and environmental safeguards for projects funded by the Bank in Burundi.

    MIL OSI Economics –

  • MIL-OSI Economics: ACP Statement on Gulf of Maine Lease Sale

    Source: American Clean Power Association (ACP)

    Headline: ACP Statement on Gulf of Maine Lease Sale

    Lease sale generated $21.9 million for the U.S. Treasury 
    ATLANTIC CITY, NJ, October 29, 2024 – The American Clean Power Association (ACP) released the following statement from Anne Reynolds, ACP Vice President for Offshore Wind after the Bureau of Ocean Energy Management (BOEM) concluded a successful lease sale for the development of floating offshore wind farms in the Gulf of Maine. Four lease areas offshore Maine, Massachusetts, and New Hampshire, were sold in today’s auction facilitated by BOEM, generating $21.9 million in revenue for the U.S. Treasury. The provisional winners were Avangrid with two leases and Invenergy NE Offshore Wind LLC, a subsidiary of Invenergy, with two leases. Once fully developed, these projects are expected to generate enough energy to power over 2.3 million homes:
    “American Clean Power commends the Bureau of Ocean Energy Management for conducting this wind energy lease sale in the Gulf of Maine, marking the first opportunity for deploying floating wind technology on the East Coast.
    “Governor Janet Mills and Maine’s proactive approach to floating offshore wind technology deserves recognition. Today’s lease sale, along with Maine’s procurement planning, is a significant step toward achieving the state’s three-gigawatt offshore wind goal.
    “As New England continues to use more and more electricity, this growing power demand can be met with clean, pollution-free offshore wind generation. Development in the Gulf of Maine will not only generate needed electricity but create jobs and investment for New England.
    “With today’s lease sale building on earlier deepwater auctions on the West Coast, the United States is truly on track to become a global leader in floating offshore wind technology.”
    Additional Background:    
    Offshore wind will play an important role in achieving Maine’s target of generating 100 percent of the state’s electricity from renewable sources by 2040, and Massachusetts plans to procure 5.6 GW of offshore wind energy by 2027. 
    BOEM’s lease sale follows extensive environmental analysis and thorough public engagement resulting in incorporation of feedback from a variety of stakeholders. The commercial lease gives the awardee the exclusive right to propose a project in the area and obtain federal review of its proposal. BOEM plans to continue growing the offshore wind sector by facilitating up to 12 offshore wind energy lease sales through 2028, including a second sale in the Gulf of Maine. 
    Most of the world’s usable offshore wind resources exist at depths greater than 60 meters, which according to the National Renewable Energy Laboratory (NREL) is the limit where fixed-bottom support structures can be placed – instead, floating substructures are needed.  
    There are strong economic incentives to develop floating wind technology that can make capturing these resources cost competitive.

    MIL OSI Economics –

  • MIL-OSI Economics: Money Market Operations as on October 28, 2024

    Source: Reserve Bank of India
    (Amount in ₹ crore, Rate in Per cent)
      Volume
    (One Leg)    		 Weighted
    Average Rate    		 Range
    A. Overnight Segment (I+II+III+IV) 559,669.89 6.45 5.00-6.75
         I. Call Money 9,351.89 6.62 5.10-6.75
         II. Triparty Repo 407,058.50 6.43 6.11-6.60
         III. Market Repo 142,040.79 6.52 5.00-6.70
         IV. Repo in Corporate Bond 1,218.71 6.69 6.65-6.75
    B. Term Segment      
         I. Notice Money** 209.50 6.43 6.10-6.65
         II. Term Money@@ 489.50 – 6.50-7.05
         III. Triparty Repo 2,536.00 6.42 6.35-6.55
         IV. Market Repo 2,134.85 6.53 6.45-6.57
         V. Repo in Corporate Bond 0.00 – –
      Auction Date Tenor (Days) Maturity Date Amount Current Rate /
    Cut off Rate
    C. Liquidity Adjustment Facility (LAF), Marginal Standing Facility (MSF) & Standing Deposit Facility (SDF)
    I. Today’s Operations
    1. Fixed Rate          
    2. Variable Rate&          
      (I) Main Operation          
         (a) Repo          
         (b) Reverse Repo          
      (II) Fine Tuning Operations          
         (a) Repo          
         (b) Reverse Repo          
    3. MSF# Mon, 28/10/2024 1 Tue, 29/10/2024 1,648.00 6.75
    4. SDFΔ# Mon, 28/10/2024 1 Tue, 29/10/2024 103,800.00 6.25
    5. Net liquidity injected from today’s operations [injection (+)/absorption (-)]*       -102,152.00  
    II. Outstanding Operations
    1. Fixed Rate          
    2. Variable Rate&          
      (I) Main Operation          
         (a) Repo          
         (b) Reverse Repo Fri, 18/10/2024 13 Thu, 31/10/2024 20,073.00 6.49
      (II) Fine Tuning Operations          
         (a) Repo Fri, 25/10/2024 6 Thu, 31/10/2024 25,005.00 6.55
         (b) Reverse Repo          
    3. MSF#          
    4. SDFΔ#          
    5. On Tap Targeted Long Term Repo Operations€ Mon, 15/11/2021 1095 Thu, 14/11/2024 250.00 4.00
    Mon, 27/12/2021 1095 Thu, 26/12/2024 2,275.00 4.00
    6. Special Long-Term Repo Operations (SLTRO) for Small Finance Banks (SFBs)£ Mon, 15/11/2021 1095 Thu, 14/11/2024 105.00 4.00
    Mon, 22/11/2021 1095 Thu, 21/11/2024 100.00 4.00
    Mon, 29/11/2021 1095 Thu, 28/11/2024 305.00 4.00
    Mon, 13/12/2021 1095 Thu, 12/12/2024 150.00 4.00
    Mon, 20/12/2021 1095 Thu, 19/12/2024 100.00 4.00
    Mon, 27/12/2021 1095 Thu, 26/12/2024 255.00 4.00
    D. Standing Liquidity Facility (SLF) Availed from RBI$       8,696.81  
    E. Net liquidity injected from outstanding operations [injection (+)/absorption (-)]*     17,168.81  
    F. Net liquidity injected (outstanding including today’s operations) [injection (+)/absorption (-)]*     -84,983.19  
    G. Cash Reserves Position of Scheduled Commercial Banks
         (i) Cash balances with RBI as on October 28, 2024 1,010,098.68  
         (ii) Average daily cash reserve requirement for the fortnight ending November 01, 2024 1,016,726.00  
    H. Government of India Surplus Cash Balance Reckoned for Auction as on¥ October 28, 2024 0.00  
    I. Net durable liquidity [surplus (+)/deficit (-)] as on October 04, 2024 488,495.00  
    @ Based on Reserve Bank of India (RBI) / Clearing Corporation of India Limited (CCIL).
    – Not Applicable / No Transaction.
    ** Relates to uncollateralized transactions of 2 to 14 days tenor.
    @@ Relates to uncollateralized transactions of 15 days to one year tenor.
    $ Includes refinance facilities extended by RBI.
    & As per the Press Release No. 2019-2020/1900 dated February 06, 2020.
    Δ As per the Press Release No. 2022-2023/41 dated April 08, 2022.
    * Net liquidity is calculated as Repo+MSF+SLF-Reverse Repo-SDF.
    € As per the Press Release No. 2020-2021/520 dated October 21, 2020, Press Release No. 2020-2021/763 dated December 11, 2020, Press Release No. 2020-2021/1057 dated February 05, 2021 and Press Release No. 2021-2022/695 dated August 13, 2021.
    ¥ As per the Press Release No. 2014-2015/1971 dated March 19, 2015.
    £ As per the Press Release No. 2021-2022/181 dated May 07, 2021 and Press Release No. 2021-2022/1023 dated October 11, 2021.
    # As per the Press Release No. 2023-2024/1548 dated December 27, 2023.
    Ajit Prasad          
    Deputy General Manager
    (Communications)    
    Press Release: 2024-2025/1389

    MIL OSI Economics –

  • MIL-OSI Economics: China’s medtech market growth to exceed global average over 2023-33 despite headwinds, says GlobalData

    Source: GlobalData

    China’s medtech market growth to exceed global average over 2023-33 despite headwinds, says GlobalData

    Posted in Medical Devices

    Prominent medical technology market experts who gathered at the MedTech Conference 2024, which was held recently in Toronto, Canada, expressed an optimistic outlook for the future of the medical devices market in China. While the global medical devices market is forecast to grow at a compound annual growth rate (CAGR) of 4.2% from 2023 to 2033, China’s medical devices market is forecast to expand at a faster CAGR of 5.0% over the same period despite some challenges, according to GlobalData, a leading data and analytics company.

    Tina Deng, MSc, Principal Medical Device Analyst at GlobalData, comments: “The key drivers of growth in China’s medical devices market include the country’s aging population, an increasing number of chronic conditions, rising penetration of medical devices at all levels of healthcare, and growing coverage by Chinese health insurance funds.”

    The overall economic slowdown in China has resulted in tighter budgets for healthcare expenditures. This financial strain may negatively impact the growth of the medical devices market as hospitals and healthcare institutions struggle to manage costs. While volume-based procurement (VBP) aims to improve efficiency and reduce costs in healthcare spending, it poses challenges for manufacturers that could affect the long-term landscape of the medical devices market in China.

    Global supply chain issues, which were exacerbated by geopolitical tensions and the COVID-19 pandemic, hinder production, and distribution. Additionally, China’s increasing protectionist policies are aimed at bolstering its domestic medical device industry, which poses challenges for international companies.

    Deng concludes: “Multinational companies need to consider differentiated strategies to reduce operational cost and offer affordable products in China. It is essential to emphasize the overall value of products rather than just their price. Highlighting superior quality, reliability, and post-sales support can differentiate products in a competitive landscape.

    “Additionally, multinational companies can collaborate with local companies or distributors to enhance their market knowledge, navigate regulatory environments, and improve access to procurement opportunities. Flexible pricing models that can adapt to different procurement requirements and buyer preferences can also be developed, ensuring competitiveness in various segments.”

    MIL OSI Economics –

  • MIL-OSI Economics: Asthma crisis in US marginalized communities from redlining requires more than just healthcare interventions, says GlobalData

    Source: GlobalData

    Asthma crisis in US marginalized communities from redlining requires more than just healthcare interventions, says GlobalData

    Posted in Pharma

    Decades after the discriminatory practice of redlining was banned in the US, its lasting impact is still driving significant health disparities, particularly in asthma prevalence, according to recent studies. These findings highlight how the combination of poor housing conditions and environmental pollutants in historically redlined neighborhoods continues to fuel the asthma crisis, particularly among children. Addressing this crisis requires more than just healthcare interventions, according to GlobalData, a leading data and analytics company.

    Redlining, a practice that historically denied financial services to predominantly minority neighborhoods, labeled these areas as “risky” and prevented necessary investments. Though outlawed in 1968, its effects persist, exposing these neighborhoods to higher pollution levels, poor housing conditions, and entrenched poverty.

    Many redlined neighborhoods remain disproportionately exposed to harmful pollutants from industrial sites and high-traffic roadways, exacerbating respiratory issues. Poor housing quality in these areas, rife with mold, pests, and other asthma triggers, further worsens the condition for residents, making it an issue of environmental justice.

    Sravani Meka, Senior Pharma Analyst at GlobalData, comments: “The legacy of redlining is a multifaceted public health crisis. The intersection of environmental hazards, poor housing conditions, and healthcare access gaps has created a perfect storm for chronic asthma in these communities.”

    Efforts are underway to address these disparities, with initiatives focusing on improving air quality, housing standards, and healthcare access. However, experts warn that systemic barriers remain.

    Meka continues: “While policy reforms are being implemented, convincing decision-makers to prioritize these vulnerable communities and ensuring healthcare providers are equipped to manage the complex needs of these patients will be crucial for long-term change. If successful, these reforms could significantly reduce asthma rates and improve quality of life in historically disadvantaged neighborhoods.”

    Meka concludes: “It’s essential that these communities receive sustained attention, not just short-term interventions, to truly dismantle the structural inequalities that drive these health disparities.”

    MIL OSI Economics –