luis de guindos : redesigning europe's financial landscape speech by mr luis de guindos, vice - president of the european central bank, at the 6th frankfurt conference on financial market policy, frankfurt am main, 14 december 2018. * * * it is a pleasure to be here today. as you know, there is a long tradition of the ecb participating in safe conferences here in frankfurt. the second conference in 2014 was already dedicated to “ banking beyond banks ” acknowledging important changes underway in the european financial landscape. 1 indeed, this was a prescient choice of topic given the growth of the non - bank sector, which has continued unabated ever since. in a recent speech2, i also highlighted the rapid growth of asset management in the euro area and at the global level, and the impact this is having on the structure of the euro area financial sector. in fact, in 2008, total assets held by investment funds made up just 15 % of banking sector assets. in 2017, these assets had grown to 42 % of total banking sector assets, amounting to €12 trillion. as the non - bank sector continues to grow, so does the need to ensure that our supervisory and regulatory framework is fit for purpose. at the same time, banks still play an important role in many areas of europe ’ s financial system, notably in the financing of small and medium - sized enterprises ( smes ). so a healthy banking sector remains crucial to financing the economy, and despite the progress made in improving the resilience of european banks, some legacy issues from the crisis continue to weigh on the system. this has two implications for strengthening the financial pillar of economic and monetary union ( emu ), which will be the topic of my speech today. first, we need to shore up the banking sector further by thoroughly completing the reform agenda that emerged in response to the crisis. this means taking the remaining steps to complete the banking union – in terms of both risk reduction and risk - sharing. second, we need to facilitate the growing role capital markets and the non - bank sector can play in financing economic growth in a sustainable and resilient manner. this requires boosting the capital markets union ( cmu ) agenda while ensuring that authorities are equipped to face the new challenges of a changing financial landscape. this will require the fragmentation of european capital markets to be overcome and the macroprudential toolkit to be extended beyond the banking system to cover, in particular, the

data be developed by the regulators or by the market? how is customer data protection being ensured, and what commercial arrangements might arise from owning that data? when dealing with such large data sets, what measures are in place to detect, respond to and recover from cyberattacks? addressing these and other open questions is important in moving the fintech dial forward. in south africa, numerous fintech firms applied for our regulatory sandbox process to trial new open banking models. to make progress within this space, we require incumbents and fintech firms to work together to shape our policy thinking and policy stances. any unaddressed solutions will possibly continue to see fintech firms using methods that may pose an increased operational risk. the solutions of open application programming interfaces ( apis ) are therefore pressing. the industry should actively engage with fintech firms on this long - standing matter. we also need to learn from jurisdictions that have already traversed this path, and modestly take from their emerging lessons. conclusion allow me to conclude. the south african regulators recognise the role they can play in addressing these access challenges. the ifwg aims to demystify the regulatory landscape, provide space for safe experimentation, and actively advance innovation. we do this through the innovation hub, launched earlier this year, and its three facilitators : the regulatory guidance unit, the regulatory sandbox and the innovation accelerator. page 8 of 9 since launching the innovation hub, we have received nearly 100 queries in the regulatory guidance unit and over 50 applications to the regulatory sandbox. these numbers show just how vibrant and dynamic the south african fintech ecosystem is. most importantly, though, they are a positive sign of increasing access to regulators and rule - making for fintechs, which enables us to hear more of those divergent and new voices. in addition, the innovation accelerator is a space for us to drive both internally oriented and market - facing innovation initiatives. we focus particularly on those initiatives that address the challenges faced, and have the potential to deliver benefits across the regulatory and broader financial services landscape. we currently have eight initiatives under the accelerator, looking at important topics such as digital platforms, cryptoassets, financial markets innovation, open banking, non - traditional data and big tech in fintech. what makes this unique is that regulators are journeying along to co - create an understanding of the major issues facing fintechs, including co - developing policy stances. the fintech phenomenon is here to stay,