and national chartering authorities have begun to consider the range of electronic commerce activities that financial institutions may operate or own. we recently issued a proposal on “ finder ” activities that would allow financial holding companies to provide, or invest in, services that bring together buyers and sellers of nonfinancial products. these activities would encompass, for example, hosting an internet marketplace or operating an internet auction site. we are considering other areas of technology and electronic commerce activities that would be considered permissible for financial organizations while still preserving the core distinctions between banking and commerce. conclusion in conclusion, we can expect financial institutions to continue experimenting with new technologies and electronic, information - based services. i believe that this is an area with great potential, yet the uncertainties are large and the payoff horizon is unknown. banks and supervisors need to recognize that it is acceptable - and even expected - to make some investments that do not pay off. we also know there have been, and will continue to be, technological glitches - computers and web sites go down occasionally, and e - mail gets lost. the new internet world is a punishing one for these routine mistakes, and financial institutions have strong incentives to take precautions and to fix problems well before they reach supervisors ’ and policymakers ’ attention. the information - based nature of financial services is unlikely to change. i am confident that banks and other financial institutions will continue to find new and better ways to put technology to their and their customers ’ best use, and that they will manage the technology and the business risks associated with these investments.

triparty repo services for broker - dealers. we have been working intensively with bnym in anticipation of this transition. we have long recognized that any disruptions to these critical market services could have serious consequences for financial stability, and have calibrated our supervisory expectations accordingly. to ensure financial stability, we expect the provision of u. s. government securities settlement services to be robust in nearly all contingencies. as bnym becomes the sole provider, we will raise our expectations even higher. the bank has anticipated and welcomed this higher bar. bnym is one of 8 u. s. - based systemically important banks. the bank is therefore subject to heightened capital and liquidity requirements and a resolution process that explicitly requires planning to ensure the continuity of critical services even in the event of a default. bnym is unique in that it also plays the dominant — and soon the sole — role in government securities settlement and in the triparty repo market. these activities are comparable in their importance to those of the financial market utilities that have been designated as systemically important by the fsoc. thus, bnym will continue to be held to the high standards to which all u. s. bank sifis are held. and it will also be expected to operate in a manner that provides confidence that it is as resilient and robust as a systemically important financial market utility ( fmu ). such fmus are, of course, held to the principles for financial market infrastructures 1 / 2 bis central bankers'speeches ( pfmis ). 2 the pfmis overlap with our banking regulation in many areas ; for example, both emphasize the need for sound risk management and the importance of resilience and recovery. the pfmis also emphasize a strong governance role in support of financial stability and the interests of market functioning, and this has been a focus of our work with bank of new york mellon regarding the transition. although our current task is to establish appropriate expectations for bank of new york mellon as a sole operator, that focus should not be taken as an indication that the federal reserve or other public authorities have pre - judged what the longer - term landscape for government securities settlement should look like. in fact, we do not have a specific market design end state in mind. rather, we recognize the systemic importance of these activities and the need to ensure their continued availability in nearly all states of the world, regardless of the firms that offer them or the specific market structure