Although I have focused mainly on the financial system of the euro area, we can clearly see that the euro area financial system is an integral part of the global financial system. With this in mind, I should like to express my support for the aims of IOSCO to promote high standards of regulation in order to maintain just, efficient and sound markets. 3  BIS Review 63/1999  Prospects for the development of banking systems in the euro area Turning now to likely developments in the banking system, it is important to note that the euro area financial systems in general and the banking sector in particular have, until now, been relatively national and fragmented with little cross-border retail activity. However, it is envisaged that the euro will add weight to a number of fundamental factors that are increasing the pressure for structural change. With these structural changes I mean not only consolidation, which seems inevitable, but also increased cross-border co-operation and mergers. In short, the euro area banking sector is expected in the future to look and behave more like the banking sector of a single economy. In addition to and reinforced by the introduction of the euro, other factors that are leading to changes in the financial landscape include technological development, globalisation and changes in what consumers and firms expect from the financial system and financial service providers. These factors are reshaping the business of banking as well as the financial system as a whole.
What we will diligently protect is the trust and credibility in our financial system. We will also be paying closer attention to financial institutions’ management of cyber-threats and to new forms of financial stability vulnerabilities as digitisation blurs the boundaries across geography and industries. Recently, we have created an enhanced role of a Chief Cybersecurity Officer as well as appointed a new Chief Data Officer. I believe there is much we can share and learn from other central banks, financial regulators and even law enforcement agencies, such as our European counterparts. Looking ahead Finally, there are other areas that should matter to all of us amidst the ongoing transformations in the banking industry. One is the important issue of financial inclusion. In the quest to innovate and as banks develop the sophistication to sharpen the profile of each customer, we should not overlook the need for financial inclusion – especially access to basic banking and financial services for under-served communities. Another area is in the responsible use of technology tools. Earlier this month, MAS announced the setting up of a regulator-industry grouping to co-create a guide to promote the responsible and ethical use of AI and data analytics by financial institutions. This Committee is known by its acronym FEAT – which stands for Fairness, Ethics, Accountability and Transparency. This gives you a good idea of its mandate. The key is as technology and data analytics usage become more prevalent, the responsible use of these is equally paramount.