rtgs systems. for example, retail payments are increasingly being settled via rtgs systems ( something which for a long time was unique to switzerland ), longer operating times are being introduced and settlement times are being shortened. these are major international trends, and we in switzerland will have to think about how we wish to position ourselves. there is also the question of how to integrate the new players – the fintechs – into the payments infrastructure. in the next slide, the payments ecosystem in our two - tier financial system is presented in a simplified form. on the first level, via the rtgs ( blue field ), the central bank enables financial institutions to settle payments using secure systems and electronic central bank money. on the second level ( green field ), the financial institutions enable retail payments. when it comes to integrating new players, there are currently two models : first, indirect access via the banks. this ‘ open access ’ approach, shown on the left - hand side of the slide under ‘ model 1 ’ ( client – > fintech – > bank ), is the one adopted by the eu. the new payment services directive ( psd2 ) requires eu banks to grant fintechs access to bank accounts. the second option involves granting fintechs direct access to core payment systems. this ‘ direct access ’ approach is shown on the right - hand side of the slide under ‘ model 2 ’ ( fintech – > rtgs ). switzerland has chosen this approach. as the snb announced at the beginning of this year, it will grant fintech companies access to the sic system and to snb sight deposit accounts, provided they have a fintech licence and their business model makes them significant participants in the area of payment transactions. the advantage of the direct access model is that it also allows retail payments made using page 7 / 9 payment solutions from new providers to be settled efficiently and securely in central bank money. this change creates a level playing field within the sic system for existing and new providers – ensuring that the swiss franc payment system remains efficient, secure and futureproof. the third challenge concerns the possible application of dlt to payment transactions. switzerland, in particular, has witnessed the establishment of a fintech ecosystem in recent years, and we are a leading fintech hub. for central banks, dlt raises at least two fundamental questions. first, could it end up replacing current core infrastructure, such as rtgs? various central banks have been experimenting with this idea, in close

philipp hildebrand : thoughts on asset management in switzerland summary of a speech by mr philipp hildebrand, member of the governing board of the swiss national bank, at the swiss funds association, berne, 28 march 2006. the complete speech can be found in german on the swiss national banka€™s website ( www. snb. ch ) * * * summary asset management is an important source of earnings for banks in switzerland. the financial industry, in turn, is the largest sector in the swiss economy and of crucial importance for economic development. assuming that the world economy stays on its expansionary course, global assets will continue to grow strongly. moreover, the rapid increase in the volume of accessible information means that clients are often better informed. it is also giving rise to a broader product range and generating tougher competition and cost pressure amongst providers. these trends will bring about far - reaching changes in asset management over the medium term. money market, equity and bond investments managed on a moderately active basis often fail to pay the consistently above - average yield that would warrant their costs. they will probably lose ground to passively managed, inexpensive products. substantially better performance will be essential for the traditional products that remain. alternative investments, too, will benefit from the structural changes. however, this area will continue to be affected by the limited supply of exceptional portfolio management expertise. asset management in switzerland compares fairly well on an international scale in terms of performance and operational efficiency. however, the industry must lose no time in tackling the restructuring that is needed, particularly in the traditional segments. in the area of alternative products, switzerland has admittedly been successful in the fund of funds business. it is to be hoped that its financial industry will build on this success and become even more of a centre of excellence for alternative investments too.