There may be costs arising from investments in innovation that fail to bear fruit or from investments with payback cycles that end up being much longer than expected, as apparently may be the case, in principle, of some of the initiatives being developed in relation to Distributed Ledger Technology. And risks relating, inter alia, to personal information privacy, fraud or cyber-attacks. In addition, the proliferation of new technologies may also lead to the financial exclusion of those users at a distance from them, who could be adversely affected if the continuity of service provision through traditional systems is not guaranteed. In short, we are facing great technological change in the banking industry, the effects of which are still not clear. The development of new services is a great opportunity for renewal for the more dynamic banks, as it may provide them with efficiency improvements and mean that they can offer greater services to their customers. And, improving customer service is precisely one of the main challenges facing the banking industry, which brings me to the final point of my address: the importance of maintaining the confidence of bank customers. 5/7  3 Confidence Confidence is the most important and the most fragile of a bank’s assets and determines the nature of its relationship with its customers, beyond the ambit of mere commercial transactions. Bank customers deposit their savings with credit institutions, trusting that they will return those savings to them, when they need them, on the terms agreed.

Aggregate demand, in particular, remains sluggish and insufficient to generate full utilisation of production capacities, hence exerting no pressures on producer prices, profit margins and, consequently, the final prices of goods and services. As we have constantly pointed out, below-potential economic growth is and will remain a key factor driving the low inflation. In parallel, global prices, liquidity situation in the Albanian economy and financial markets, and economic agents’ inflation expectations have not and are not expected to generate strong inflation pressures in the medium-term period. Indirect information on the performance of the Albanian economic activity in the last quarter of 2012 suggests sluggish growth. Aggregate demand was primarily driven by the higher exports, while the private domestic demand provided positive, albeit low, contribution. On the other hand, public sector expenditure shrank, hence making a negative contribution to the growth of aggregate demand. There is scarce information on economic developments during the first quarter of 2013. However, the analysis of available indirect data suggests that aggregate demand remains sluggish and economic growth below potential. Economic activity has been mostly driven by the external demand and a higher fiscal stimulus, while the contribution of consumption and private investment remains low. The latter continue to suffer from the uncertain outlook, the lower increase in disposable income, the spare production capacities, and the relatively tight lending standards. These factors have been reflected in Albanian households’ increasing propensity to save and businesses’ reluctance to invest. External demand and the favourable weather conditions increased Albanian exports by about 34.6% in January.