Instead, what it would require is a self-generated sea-change in the structure and strategy of banking. So what changes in structure and strategy might be desirable? Without suggesting definitive answers, let me discuss three areas where further debate might be useful: banks’ size in  10  David Tuckett provides a fascinating account of the crisis and its aftermath using psychological theories and evidence (“Addressing the Psychology of Financial Markets”, Institute for Public Policy Research, May 2009). 11  “Is the US Sub-Prime Crisis So Different? An International Comparison”, Carmen Reinhart and Kenneth Rogoff (2008), NBER Working Paper No.13761. BIS Review 108/2009  5  relation to the services they provide; banks’ strategy in relation to their resilience; and banks’ governance in relation to the incentives this creates. •  Structure – size versus service provision  Economies of scale typically arise in the production of goods and services which are homogenous and replicable. Henry Ford applied this principle to car manufacture through his Ford Motor Company, established almost a century ago. It was a success. That model has since served many industries well. But manufacturing loans is not the same as manufacturing cars. Loans are neither homogenous nor replicable. Making loans relies on bespoke, customer-specific information. This information is not obtained by computer algorithm or credit rating agency but through a banking relationship, ideally a long-term one. Despite the advent of social networking, economies of scale are not something we typically associate with long-term relationships.

Jon Nicolaisen: How important is it for a nation to have a payment system? Speech by Mr Jon Nicolaisen, Deputy Governor of Norges Bank (Central Bank of Norway), at Finance Norway's payments conference, Oslo, 14 November 2019. * * * Please note that the text below may differ slightly from the actual presentation. The payment system and Norges Bank A nation needs to have a well-functioning payment system. Without fast, inexpensive and secure payments, a modern society grinds to a halt. Users today have access to payment methods that are dependent on large-scale IT systems to process payments efficiently. We need to ensure that the payment system can adapt to new technologies and meet the needs of business and consumers in the future. The Storting (Norwegian parliament) has assigned Norges Bank the task of promoting an efficient and secure payment system. This is clearly spelled out in the new Central Bank Act, which enters into force at the turn of the year. Norges Bank is the operator of the payment settlement system and supervises interbank payment systems. These operational roles may take on greater importance in the coming years. Let me point out two trends. First, we note increasing vertical integration in the payment market. Customer interface services are becoming more tightly linked to the underlying infrastructure. We saw an example here in Norway when Vipps merged with BankID and BankAxept. There is also a tendency for common contractual arrangements that were previously situated with industry organisations to be relocated to product companies.