of efficient resolution regimes for financial institutions, which have been incorporated in the brrd, resolution authorities should be able to write down or convert into equity liabilities in a manner that respects the hierarchy of claims in a liquidation. thus, when a bail - in by creditors takes place, legal certainty and predictability are essential. despite the limited spillovers, the idiosyncratic aspects of the bail - in by uninsured depositors in cyprus may remain a cause for concern among investors. creditors need to have a clear picture of what could happen in the event of a bank failure. this is key to avoiding excessive market volatility, bank runs, underprovision of capital and liquidity and / or overpricing of risk. this can be done by respecting the hierarchy of creditors in the event of insolvency, i. e. the order in which creditors will suffer losses in a bail - in. in order to enhance legal certainty and predictability, a clear pecking order has to be established regarding the financing of resolution measures. losses and resolution costs should first and foremost be borne by the shareholders and subsequently by the creditors of the failing institution. only at that point should the private sector be called in to finance resolution via the resolution fund. then and only as a last resort in case the accumulated funds in the resolution fund are insufficient, should there be a temporary public backstop providing credit to the resolution fund. but any such support should be fiscally neutral and bis central bankers ’ speeches recouped through ex - post levies on banks. this will ensure that financial sector repair is ultimately financed by the private sector itself. as regards the use of bail - in, let me stress that it should not create wrong incentives to the original entity by just continuing with “ business as usual ”. following the resolution process, only the critical functions and “ good parts ” of the original entity should survive, either because they are sold to a private sector purchaser – as commonly done by the fdic with the purchase & assumption approach used in the us – or because they are transferred to a bridge bank. it needs to be clear that the aim of resolution is not to preserve the failing institution as such, but to ensure the continuity of the functions that are critical for the financial system as a whole. another important way of providing legal certainty and predictability in resolution would be to introduce harmonised depositor preference for eligible deposits in the eu. currently, deposits have a preferential status in

the quality of customer relation arrangements. sanctions are of course an essential deterrence tool, and ( again, differently from prudential supervision ) may be complemented by the power to impose the reimbursement of sums unduly charged ( which directly favor damaged consumers, differently from sanctions ). product intervention powers may further enrich the supervisory toolbox, preventing harmful products from being distributed. in addition to public enforcement, effective customer protection may also be based on private enforcement tools. complaint management, and effective alternative dispute resolution ( adr ) schemes enabling customers to seek redress, represent relevant tools. public authorities may have a role in establishing, or at least promoting, adr schemes for the financial system. last but not least, financial education programs may obviously complement regulation and enforcement in ensuring effective consumer protection. overall, the work of finconet over these years has become extremely relevant in supporting the comparison and evaluation of supervisory instruments, the dissemination of good practices, the analyses of critical issues, the formulation of policy proposals. the bank of italy has also devoted a great effort to the development of a comprehensive consumer protection framework in the italian banking system. in 2009 we established a banking ombudsman. in 2014, we established a new directorate responsible for business conduct supervision and in charge of financial education initiatives. since then, we have issued several guidelines for financial intermediaries ; the ombudsman scheme has given solutions to a very large number of complaints filed by customers ; banks and other financial intermediaries reimbursed over € 300 million to customers ; our financial education activities reach more than 100. 000 students every year. however, despite the steps taken so far, we are aware that we are still in the “ early age ” of business conduct supervision. that is why finconet meetings are important : we believe that comparing practices, sharing knowledge and experiences are essential to ensure financial consumer protection. the agenda of this two days meeting is very rich. you will be able to analyze and exchange views on several relevant issues : the tools available and their effectiveness, the evolving context in your respective jurisdictions, the use of new technology in market conduct supervision. new technologies in the financial system challenge regulators and supervisors, they open up new streams of products and services in a fast - changing market. the rise of “ open banking ” and the increased accessibility of bank accounts by third parties represent the most visible innovations in this field and are already contributing to reshaping the financial landscape. conduct supervisors