Allowing risk to build up in an unregulated sector may impair financial stability in the long run and reverse all the progress that has been achieved in the past. Closing Remarks Ladies and gentlemen, to bridge regulation with financial innovation, we first need to understand innovation and how technological advances can aid regulation and vice versa.
Because interbank markets are global in scope, the Federal Reserve has also approved bilateral currency swap agreements with 14 foreign central banks. The swap facilities have allowed these central banks to acquire dollars from the Federal Reserve to lend to banks in their jurisdictions, which has served to ease conditions in dollar funding markets globally.