And now, in Iceland, financial supervision and other central bank activities have joined forces again, after a separation of 22 years. Now we have a single institution that is responsible for financial stability and has information on the financial system and developments in systemic risk within that system. The reunified Central Bank has far more explicit authorisations to intervene when events warrant it. It now has to power to affect the behaviour of financial institutions and market agents for the better. Unfortunately, the Icelandic language, rich though it is, still lacks a good enough translation of the English word “prudence”, which encompasses all that we hope to elicit in supervised financial market entities’ behaviour. We need a word that captures the concepts of foresight and thrift. I would like to reiterate what my predecessors said in the aforementioned letter to the Minister of Commerce: Supervision is a normal and appropriate part of the Central Bank’s activities. This supervisory role benefits just as much from its partnership with the Central Bank as various other Bank activities do from partnering with banking supervision. We have seen this in action. The year or so since the merger took effect has been a busy one, but it has proven the value of joining forces – in case anyone was in doubt before. For example, the integration of data and intelligence has been demonstrably beneficial during the pandemic, allowing increased oversight, improved analysis, and harmonised responses.
Major banks and insurers are accelerating their digital transformation and ramping up hiring in application development, data science, and artificial intelligence. Example: OCBC Bank recently announced that it plans to hire 1,500 technology staff over the next 3 years, with the majority of those positions to be based in Singapore. Bank of America has based one of its two overseas global cyber security centres in Singapore. The bank currently has more than 800 headcounts in Singapore focusing on technology. Another example is Shanghai Pudong Development Bank, which set up its first overseas innovation centre in Singapore. Likewise, global insurers like SCOR have established innovation labs in Singapore. Local insurers have invested heavily in technology too. Singapore has made a name for itself as providing one of the world’s most conducive environments for financial innovation. We are now home to over 50 global and regional innovation labs and more than 1,400 FinTech firms. Last year, we saw record high FinTech investments of $ billion last year, up from $ billion in 2020 [2] . Leading players at the forefront of digital asset innovation have anchored their operations in Singapore. JP Morgan has partnered DBS Bank and Temasek to establish Partior, which is a multi-currency, cross-border settlement platform, leveraging blockchain technology. R3, a global distributed ledger technology provider with roots as a banking consortium, has grown its innovation hub in Singapore to become the regional headquarters for Asia.