that a number of borrowers have a high loan to value ratio, particularly those below the age of 35. household debt growth has been higher than income growth since 1999. the debt burden, defined as debt in relation to disposable income, has therefore increased markedly. households ’ financial position is nonetheless sound. as measured here, housing wealth in norway is almost four times higher than total household debt. debt and wealth are, however, unevenly distributed. combined with any marked turnaround in the housing market, this would create problems for exposed groups. however, the financial situation of households as a whole is satisfactory. unemployment is unusually low, but must be expected to increase somewhat in the medium term. household disposable income is expected to show continued high growth ahead. due to the long period of strong debt growth and sharply rising house prices, however, households ’ financial position has become more vulnerable. corporate sector corporate profits have been very high in recent years. these positive developments have been broadly based and are mainly driven by favourable economic conditions in norway and abroad. enterprises have on average large financial buffers. banks ’ lending to the property industry accounts for approximately one third of their lending to the corporate sector. this sizeable exposure to one industry is a possible risk factor in relation to financial stability in norway. both property enterprises and their tenants are in a generally healthy financial position. prices in the commercial property market have risen considerably in the past two years, and market participants are expecting the sharp rise to continue. lower demand in the norwegian economy may result in a slower rise than the market expects. combined with higher interest rates, this may reduce profitability in the commercial property market, increasing banks ’ losses. losses on loans to the property industry accounted for a large share of banks ’ loan losses during the banking crisis. outlook for the banking industry banks in norway have experienced extremely favourable developments over the past few years : strong lending growth, minimal loan losses, high returns in securities markets and firm cost control. despite lower interest margins, banks ’ net interest income in nok is rising as a result of strong lending growth. measured in relation to total assets, however, net interest income is falling. in recent years, this has been offset by a reduction in costs. today ’ s high debt growth is not sustainable over time, and it is unlikely that the pressure on interest margins will abate. given these developments, banks must reduce costs or increase income from other sources if they are to maintain their current

regtech adoption is a journey for banks and we should begin to drive more effective outcomes in better leveraging that process. 20. we have seen in the past two years an increasing trend for regulators globally to call for, and through their actions, enable more innovation and flexibility in combatting money laundering and financial crime. that i think is a very welcome development. 21. at the end of 2019, just before the pandemic started, the hkma held an aml / cft regtech forum to explore the role that technology could play in preventing and detecting financial crime. one of the key lessons that transpired from that event was the importance of bringing different parts of the eco - system together to discuss common challenges and pain points with fintech firms who may be able to offer solutions. and we have followed up across the three breakout groups of banks, what we called accelerators, enablers and collaborators1, over the past year on concrete plans of individual banks. 22. in january this year, we released a report titled “ aml / cft regtech : case studies and insights ”. through that, we shared comprehensive, hands - on experience from banks at different stages of aml / cft regtech adoption, and emphasised a number of key insights on the potential for technologies to assist in detecting and preventing money laundering and financial crime. 23. in that guidance, we have also deliberately and explicitly identified specific technologies and data applications, such as data analytics and the use of non - traditional data like ip addresses as well as robotic process automation in handling transaction monitoring alerts. actually, some of those technologies featured prominently in the successes we saw in identifying and disrupting networks of mule accounts linked to covid - 19 scams and also the rising number of investment scams. 24. our guidance also underlines another important point that as far as regtech adoption is concerned, the human element remains critical to identifying and developing the skills required to advance aml / cft regtech adoption, while being supported by a culture and 3 / 5 bis central bankers'speeches capacity of innovation. 25. this issue of the human element and the need to put in proper capacity is, of course, easier said than done. data and other highly trained specialists are certainly essential to the adoption of certain aml / cft regtech solutions. however, data specialists have to work with experienced aml professionals, who continue to be vital to building and maintaining an effective control framework. we have