to remain competitive, banks will have to adopt new financial technology fast enough while making sure that the organizational structure, corporate culture, and business models are agile and adaptive. more importantly, large non - bank fintech players are becoming significant players in our financial landscape. banks cannot afford to wait and see the landscape change before taking action. every day, new business models are being developed. technology adoption by banks is therefore unavoidable should they wish to stay ahead. as ravi menon, mas managing director, recently said at the singapore fintech festival, “ in an industry facing the headwinds of lower economic growth and heavier regulatory burdens, innovation must be the way to refresh and re - energise the business model. ” fortunately, financial technology is being adopted in many asean countries, notwithstanding their different stages of development. singapore is testing a blockchain - based system for interbank payment to simplify the payments process and reduce costs. in cambodia, wing money transfer and payment services are popular among local people. in thailand, the government and the bank of thailand, together with the banking industry, are committed to supporting the use of technology for greater efficiency and productivity in the financial sector and the economy as a whole. early next year, prompt pay or the fast p2p payment system will be implemented. prompt pay will be an impetus in changing consumers ’ behaviours to use electronic payment for everyday goods and services. transactional banking could be easily completed online or via mobile phone rather than going to bank branches. this move towards less reliance on cash will reduce the cost of cash handling thereby increasing efficiency of the banking industry and the thai economy as a whole. on the downside, technology comes with associated risks. in recent years, cyber threats have increased dramatically in frequency, sophistication and their widespread effects. this year, at least four financial institutions in bangladesh, vietnam, ecuador, and the philippines became victims of cyber heist involving the swift system while atms in japan, taiwan, thailand, and recently in many european countries have been hacked. it security and cyber security need to be addressed for secure transactions and to ensure trust among customers. the bank of thailand and the thai bankers association ( tba ) have collaborated to set up an information sharing group ( isg ) or financial - sector cert. the group enables comprehensive information sharing and connects to other involved parties such as cyber security specialists, vendors, and legal enforcement agencies, to develop defensive, preventive and

vitor constancio : the european crisis and the role of the financial system speech by mr vitor constancio, vice - president of the european central bank, at the bank of greece conference on “ the crisis in the euro area ”, athens, 23 may 2013. * * * slides to the presentation can be found on the ecb ’ s website. introduction let me begin by thanking the bank of greece for inviting me to this important conference attended by so many prestigious researchers. there are, of course, several narratives and interpretations about the way the crisis unfolded in the euro area. for some, it is mostly a story of unsound fiscal policies and excessive sovereign debt ; for others, it is principally a story of competitiveness losses engineered by uncontrolled unit labour costs ; and for others still, it is essentially a traditional balance of payments crisis in a “ fully fixed ” exchange rate regime. in more recent years, the narrative of seeing it as a banking crisis has gained attention, combining it with the sovereign debt crisis to create a story of “ two debt overhangs ”. naturally, there is a grain of truth in all these narratives, as is to be expected given the complexity and interplay of factors within a major international crisis. however, more than trying to discuss a cogent overall interpretation of the euro area crisis, i would like to explore two perspectives : • first, what were the root causes and key initial drivers of the crisis? • second, what role did the international financial crisis, originating in the us, play in triggering the european crisis? the first question is important to identify the possible shortcomings in the design of monetary union that need to be corrected to avoid future crises. it is my contention that the main driver of the crisis was located in the financial sector, particularly banks which intermediated large capital flows towards the periphery, creating imbalances that became unsustainable when a sudden stop occurred following the international crisis and the abrupt revision of price of risk that it entailed. the second question is useful to consider whether the construction of monetary union would have been sufficient to ensure a gradual correction of vulnerabilities and avoid a crisis, if a major international shock had not occurred. one can speculate that, left alone, the euro area may have been able to gradually overcome its own vulnerabilities through a process of interregional rebalancing. but we can never be certain about that. fortunately, this