Claudia Buch: Digital finance - does it change the trade-off between risk and resilience?
Welcome address by Prof Claudia Buch, Chair of the Supervisory Board of the European Central Bank, at "The Future of Digitalization and Finance" symposium, organised by the Deutsche Bundesbank, Frankfurt am Main, 22 March 2024.
The views expressed in this speech are those of the speaker and not the view of the BIS.
Thank you very much for organising this symposium on "The Future of Digitalization and Finance". I am very grateful and honoured that it coincides with the farewell event for Joachim Wuermeling and me. I would like to thank the distinguished panellists for accepting the invitation to speak here today and I would like to thank all of you for coming.
First and foremost, I would like to thank all the dear colleagues here at the Bundesbank with whom I have worked closely over many years. Our work together has shaped my thinking about the banking and financial system, financial stability, the key role of our institutions in Europe and beyond, and the essential role of central banks in contributing to financial stability and the welfare-enhancing integration of financial markets. In today's uncertain world, this is more important than ever.
I would like to thank you wholeheartedly for the great cooperation, and I am proud of what we have achieved together.
But the almost ten years that I spent at the Bundesbank as its Vice-President were in fact neither the beginning nor the end of our cooperation. Since the early 2000s, I have worked closely with the Bundesbank on many research projects, and in my new role as Chair of the Supervisory Board of the ECB, I will continue to work with all of you.
Dealing with today's topic – the implications of digitalisation and its impact on the stability of banks – remains our joint responsibility within the Eurosystem.
Today's banks operate in an environment which looks radically different to how it looked 30 years ago, due in no small part to the transformative impact of digitalisation. The digital revolution, along with the rise of artificial intelligence, has the potential to fundamentally affect the key functions that banks perform in the economy. Reducing information asymmetries, mitigating moral hazard, and leveraging their unique position to provide deposit-taking and lending services – these functions determine banks' franchise value and their role in the financial system.
This raises three important questions.