jean - claude trichet : integration and innovation – the alpha and omega of a successful retail payments market in europe opening remarks by mr jean - claude trichet, president of the european central bank, at the joint ecb / the netherlands bank conference on " retail payments : integration and innovation ", frankfurt am main, 25 may 2009. * * * ladies and gentlemen, it is a great pleasure for me to open this conference on integration and innovation of retail payments. this conference, organised jointly by the european central bank and de nederlandsche bank, brings together participants coming from more than 30 countries of all five continents. the research papers have been carefully selected from an amazing number of submissions. together, we will explore how to interlink policy conduct, research activities and market practice in a field of banking that is not always in the limelight, namely retail banking. retail banking has proven to be an area of stability within the banking business during the recent period of financial turmoil. payments business, which generates about one quarter of all banking revenues, has remained a source of strength. at a time when banks ’ other sources of income are more volatile, they can count on reliable and regular revenues being generated through payment services. the other side of the coin is less alluring. payments business roughly accounts for one third of the operational costs of the banks. in europe, part of these costs is obviously related to the current fragmentation in the retail payments market. overcoming such fragmentation by means of more integration would decrease the operational costs banks are confronted with. this is the link to our topic today. against this background, it is no surprise that today ’ s first theme will be the relevance of retail banking and payments for banks ’ profitability. mr. lavayssiere, director of global financial services capgemini, will make the keynote speech on this theme, and i am sure that his remarks and the following academic session will provide fundamental insights into the economic rationale for the integration and innovation of the retail payments market. successful integration of retail payment markets will not only provide benefits in terms of diminishing costs, it will also contribute to financial stability. restoring confidence in, and improving the resilience of, financial systems is of paramount importance. governments and central banks around the globe have made unprecedented use of their policy tools to fight further economic and financial decline. the ecb and the eurosystem have taken rapid and bold actions in response to the crisis. these measures have been providing refinancing

which will also create room for further tax cuts and absorb the fiscal costs of population ageing. this reform agenda, as well as the urgent structural reforms relating to product, labour and financial markets, will be addressed in the forthcoming broad economic policy guidelines. overall, such reforms reflect the key challenge for the euro area to expand its potential for non - inflationary growth and to reduce its high level of unemployment. the governing council calls upon member states to make faster progress in accelerating and deepening structural reforms in order to provide economic agents with the proper incentives to enhance efficiency and entrepreneurship and to progress towards a knowledge - based economy as proclaimed in the lisbon agenda and confirmed in barcelona. we are now at your disposal for questions.