of trust. and without regulation and effective supervision, financial services firms cannot be trusted to deliver what is required of them in the way the economy needs and society expects. this is the lesson of the most recent crisis and all crises before that. it is the lesson from the multitude of conduct failures. regulatory change has, among other things, been required to address gaps or weaknesses in the system that were being exploited or at risk of being so. we all have a job of work to do to try and restore trust in the system. current challenges with one very notable exception, the internationally focused financial services firms operating in ireland have not experienced the same levels of failures and losses as the domestically focused sector. this is obviously welcome, but should not be a cause of complacency. there are significant risks and challenges that need to be addressed, including : ( i ) macro risks the macro economic environment has improved considerably, both domestically and internationally. growth has returned in the eurozone and is now well established in ireland. however, significant risks are evident. our latest macro financial review will be released next week. i urge you to read it, as it covers in some detail the progress and vulnerabilities in the irish economy and the financial system. for example : valuations for many asset classes have been increasing for a long period – from government bonds through to bitcoin, from stock markets to real estate. market volatility is very low. this bull run can not last forever. quantitative easing will end. interest rates will rise. asset valuations will 2 / 7 bis central bankers'speeches fall. hopefully, this will all be orderly, but history would warn against any complacency in judging that this time is different. geo political risks are also elevated. most notably, we may all hope for an orderly brexit, a topic i will return to, but there is no certainty that this will be the case. whatever the outcome, it is likely to be negative for the irish economy and the financial services system here and potentially across the eu. at the risk of generalisation, as ceo ’ s and senior managers in international financial services firms, the majority of you are likely to be more optimistic than your prudential regulator. in fact, in the same way as i am paid to consider downside risk, you are incentivised to consider the upside. nonetheless, we all need to be prepared for the plausible worse case. after a storm it is important

##l o ’ keeffe for their assistance in preparing my remarks. rosling, h., rosling, o., and rosling ronnlund, a. ( 2018 ), “ factfulness : ten reasons we ’ re wrong about the world - and why things are better than you think ”, hodder & staunton. ibid irish statute book ( 2018 ). “ constitution of ireland ” eurostat ( 2019 ). “ mean and median income by household type - eu - silc and echp surveys ” for 1995 - current data, using mean ( median ) data, in 1995 irish median household income was 80 % ( 75 % ) of the eu 15 value, and in 2017 was 140 % ( 135 % ) of the eu 28 value. see article by my colleague on the central bank commission, professor john fitzgerald, irish times : eu has helped transform living standards of europe ’ s people ( 26 january 2018 ). conefrey, t., & smith, r. “ on the slide? salary scales for new graduates 2004 - 2012 ”, central bank of ireland, economic letter, vol. no. 1 ( 2014 ).. 7 see for example lydon, reamonn & mcindoe - calder, tara ( 2017 ) “ the great irish ( de ) leveraging 2005 - 14 ", mcindoe - calder, tara ( 2017 ) “ debt giveth and debt taketh away : mortgage debt burden in ireland ”. the insolvency service of ireland shows that between 2013 and 2019, 32 % of debtors applying for some form of resolution were aged 35 - 34 and 36 % were aged 45 - 54. 8 lydon, r : “ do households with debt problems spend less? ”, central bank of ireland, economic letter, vol. no. 2. ( 2013 ). 9 organisation for economic co - operation and development ( 2019 ). “ income inequality ”. the gini index measures the extent to which the distribution of incomes among households deviates from perfect equal distribution. a value of zero represents perfect equality and a value of 100 extreme inequality. the gini coef cient for market income rose from 51 to 58. it remained around 31 for disposable income inequality. 10 causa, o. & m. hermansen : “ income redistribution through taxes and transfers across oecd countries ” ( 2018 ). redistribution is measured by the difference between the gini coef cient