This helps to explain why at the Bank of England we are conducting a system wide stress exercise involving non banks as well as banks to help us to map out the risks. This is inherently a cross-border issue. So, we must make progress internationally. This is what the Financial Stability Board work programme is focussed on, and why it is so important. It is also crucial that individual countries take forward and implement these reforms. While the solutions are global, delivering them will necessarily be local. Finally, there is an important point to pull out of a number of these issues. A common outcome of a shift in the balance from inside to outside money (either through CBDC or banks holding larger reserves at the central bank) or increasing the broader liquidity buffers of banks and non-banks could be to create a constraint on lending and investment in the real economy. For the UK economy this would go against the need to finance investment to support stronger potential growth, from its current weak level. This constraint would not appear if the counterfactual was an unstable financial system because solving that instability would have to be the priority. But in a more stable world public policy must still determine the best use of tools – for instance, advocating ever tougher stress tests and larger liquidity buffers in an attempt to cover future Black Swans is not obviously preferable to having tools by which central banks can make temporary and targeted interventions, as we did last October.

Let me end with the short version of the main points: 1: I don't believe we face a systemic banking crisis; 2: We must ensure that financial stability continues to mean that monetary policy takes into account financial conditions but does not have to aim off for instability; 3: This requires robust structures for financial stability policymaking;  5/6  BIS - Central bankers' speeches  4: Central bank balance sheets will remain larger than pre-crisis for financial stability reasons; 5: We don't know yet where central bank balance sheet reduction will need to stop in terms of the necessary level of reserves; 6: This will in part depend on the desired future size and make-up of banks' liquidity buffers; 7: Stable coins will need to have the characteristics of, and be regulated as, inside money; 8: The key question on retail digital money is can we envisage a demand for it, but we should guard against failure of imagination; and be able to accommodate it within the regulatory framework; 9: If retail digital money is part of the future, it would be better not to disturb the need to have both inside and outside money – so we cannot rule out a need for CBDC; 10: We will need to revisit the protection of inside money in the form of deposits, especially in smaller banks; 11: Stress testing the financial system is crucial, but stress tests will not always deal with Black Swans – that's why resolution and other policy intervention tools must be in place; 12: Non-Bank Financial Intermediation is a very large and heterogeneous landscape – it presents surveillance challenges of both breadth and depth; 13: NBFI leverage and inter-connectivity can be hard to map; 14: NBFI issues are often inherently cross-border in nature.