topic of technological innovation and financial services. 3 i shared our understanding of the drivers, potential outcomes, associated risks and the readiness of financial firms. much of what i discussed then remains valid today. i 3 / 5 bis central bankers'speeches spoke about the digital revolution underway within incumbent firms to keep pace with the increasing consumer demand to move online. i also discussed the associated business model trade - offs this poses, given the burden of aging legacy infrastructure compounded by the threat of new entrants. the tensions of conflicting forces at work remain. there are signs that point to degrees of consolidation, and indeed cooperation across the sector ( as can be seen from cooperation on technology such as blockchain ). there may also be increased fragmentation pressures caused by new specialist providers and a likelihood of new strategic alliances being formed among larger incumbents and newer financial technology providers. whatever the outcome, there will be winners and losers and a “ zero failures ” objective is not appropriate. as such, we can see a wide range of risks associated with innovation. for example, we can see : increased competition that can erode income streams and reduce profitability ; or new conduct risks from new categories of potential mis - information and mis - selling ; or increased operational risk due to the intrinsic characteristics of some new technologies, together with elevated implementation risk. when we assess agility of firms to adapt to such technology pressures, our experiences have been varied. some firms have a coherent approach to considering the risks. many other firms are less able to invest in innovation due to a continued draw on resources to resolve legacy risks. through resolution of such issues from the past, their perspective must change so that the necessary ( and overdue ) investments are made for the future. in this light, as the financial services landscape evolves, the central bank itself recognises that it must advance its thinking. our own frameworks and tools ( consumer, prudential, and financial stability ) must change with the evolving geometry of the regulatory perimeter. in this context, a fintech working group has been established within the central bank. initially, it has focused on providing an overview of the fintech sector and stakeholder map of the fintech ecosystem. key observations drawn by the group so far include that payments system innovation is at the forefront in ireland and that innovation occurring at incumbent firms ( rather than fintech firms ) is likely to have more impact for retail clients, if current trends continue. further, novel innovations in the markets sector, such as

us well placed to meet the objectives set out in the international memoranda on crisis management issues – where the sharing of information and expertise at national level would be important to the handling of any cross - border financial crisis. in summary, financial stability considerations were key in the design of the organisation. this choice of organisational structure reflected the shared high - level objective of contributing to financial stability for both the central bank and financial regulator. the end result is an organisation with a cohesive and comprehensive approach to financial stability issues. many thanks for your attention today.