as so - called “ shadow banking ”. contagion is most likely to occur when information is not equally available to all parties. opacity and a lack of information about exposures were endemic to otc derivative markets during the crisis, making these markets an important locus of contagion. following the postcrisis reforms, derivative markets have functioned more effectively. regulatory mandates and supervisory incentives are resulting in a larger share of derivatives transactions being cleared through central counterparties and more are being collateralised and are therefore safer. policymakers also have more visibility about financial market infrastructures now that they play a more central role in financial markets. there are, though, some informationsharing issues in this area that still need to be worked out. bis central bankers ’ speeches one other outstanding issue is how the multiplicity of indicators of systemic risk can inform policymaking, and how one might use the signal provided by an indicator to develop a particular policy response. this is no easy task. the insights of research such as the work presented at this conference will certainly be welcome. conclusion : the role of supervision in all three areas i have spoken about – namely, resilience, the financial cycle and systemic risk – it is easy to focus mainly on the regulatory initiatives. regulation can be printed, measured and enforced. but history teaches that regulation cannot solve all problems. the financial system evolves, so no set of rules can deal with all risks and problems. this is an important reason why there needs to be a parallel focus on strong and effective supervision. my view is that a strengthening of supervision is at least as important as are the post - crisis regulatory reforms. rigorous, inquiring supervision that takes a holistic view of the environment is essential to maintaining financial stability and good outcomes for consumers. i encourage you to consider how the research agenda can be expanded to consider how to best balance regulation and supervision. thank you for your attention. i wish you the best as you grapple with this difficult set of issues over the next couple of days. bis central bankers ’ speeches

. the infrastructure has been set up as a utility, and pricing will be on a cost recovery basis. this infrastructure can then be utilised by any number of commercial ‘ overlays ’ to deliver services that use the npp ’ s real - time clearing and settlement capabilities. the first of these is osko – initially offering person - to - person payments but within a year or so offering payment with document and request to pay. it is also expected that other innovative services will look to leverage the real - time payment capability of the npp. the third relatively unusual facet is the real - time transaction - by - transaction settlement of retail payments 24 hours a day, 7 days a week. australia has had a real - time gross settlement system 3 / 6 bis central bankers'speeches for high - value payments for weekday settlements for the past 20 years. and this is indeed best practice around the world for high - value payments. but not many countries currently provide realtime settlement of retail payments, and even fewer offer it 24 / 7. many fast retail payments services, for example, settle payments in batches through the day or only during business hours. the advantage of utilising real - time settlement in our fast payment service is that it extinguishes settlement risk and removes the need for other controls over settlement risk, such as caps on exposures. the fact that these controls are not required removes some limitations that might otherwise need to be considered by overlay service providers as they design their products. so now we have this world - class infrastructure, what for the future? the first point to note is that it is still early days. given the complexity of the build and the longterm nature of this important piece of infrastructure, the launch was never intended to be a ‘ big bang ’. while there had been extensive testing ahead of launch, including an extended period of live proving, moving into production always uncovers some issues. a cautious approach to ramping up volumes was therefore an appropriate way to manage the operational risks. second, the experience of fast payment systems around the world suggests that volumes will increase quite slowly at first. it took the uk fast payment service around 3½ years to get to 10 transactions per person per annum and swish, the swedish system, just under 3 years to get to this level. there are probably a couple of reasons for the initially relatively slow growth in volumes. it will take some time for people to become familiar with the new system – people