How we fulfil our tasks Ladies and gentlemen, in light of the high loss potential of mortgage and real estate market crises, the question is: How can systemic risks originating in these markets be contained? From a macroprudential perspective, three elements stand out: identifying the risks at an early stage, containing their growth, and strengthening banks’ resilience. I would like to explain these three elements in greater detail. Let me begin with the SNB’s risk monitoring, before speaking about the macroprudential instruments we have at our disposal. 5  Cf. the SNB focus article Household wealth in Switzerland: concepts and trends in an international comparison, available online on the SNB’s data portal: data.snb.ch/en/topics/texts#!/doc/focus_20210429 (consulted on 30 August 2021). Page 4/12  Risk monitoring  In identifying risks at an early stage, we are interested in vulnerabilities on the mortgage and real estate markets and in their possible consequences for the banking sector. Vulnerabilities manifest themselves primarily in inflated real estate prices and unsustainable mortgage lending. Both entail a heightened susceptibility to corrections in the form of sudden drops in prices and sharp rises in loan defaults. Our assessment of these risks is based on a broad range of data and methods. The fact that such a broad range is required reflects the high level of uncertainty involved in measuring these risks, as well as the different strengths and weaknesses of the individual indicators used. The more indicators there are pointing to a certain development, the clearer the assessment becomes.

What makes one transmittal of funds different from another is purpose. An understanding of purpose often comes from meeting a customer in person and speaking with her about her business goals. Improve Communication One final way forward is to improve communication and information sharing. Here are some questions you might consider. 4/6  BIS central bankers' speeches  Within your firms, how does the front office communicate with the control and audit functions about money laundering risk? Is there a frank discussion about common challenges? Or do those discussions resemble depositions or some other defensive exercise? Between and among firms, do you take advantage of inter-bank information sharing opportunities pursuant to Section 314(b) of the USA PATRIOT Act? 16 If you are a smaller, community-oriented bank, how are you using recent federal guidance that encourages collaborative arrangements that pool anti-money laundering resources?17 Regardless of size, does your firm insist that customers use the proper SWIFT message type with all the required fields completed in the right format? And, if your firm processes high-risk activity with limited transparency, do you ask respondent banks to supplement payment messages with additional information? When communicating with the government, how helpful are your suspicious activity reports—or SARs, for short? Are you filing them in the spirit in which they were intended, or for defensive purposes? Are you picking up the phone to call law enforcement when you file a SAR that presents heightened concerns and perhaps should not wait to run through the formal reporting and referral process?