resilience of the global financial system and that inadequate powers to deal with financial failures pose a financial stability and a fiscal risk. the failure or distress of financial institutions as well as the possible spillover effect that these failures can have on the wider economy is something that all countries are exposed to. history has also shown that disorderly bankruptcies lead to uncertainty, which in turn leads to a disruption in financial markets and a sharp fall in bank equity prices. to best deal with the risk that failed or distressed financial institutions might pose, regulators have to ensure that they have appropriate powers and arrangements in place to effectively contain or mitigate the risk ( s ) that the failed or distressed institution poses to the wider economy. the key attributes of effective resolution regimes for financial institutions ( key attributes ) set out the powers and tools that national resolution authorities should have at their disposal for firms in all financial sectors that could have a systemic impact if they failed. the key attributes also set out recovery and resolution planning requirements for such firms, and require that crisis management groups of home and key host authorities are set up to coordinate group - wide resolution strategies and plans for global systemically important banks. the overarching objective of the key attributes is to assist in an orderly resolution without making use of taxpayer funds as it has been proven that the injection of capital from national authorities into a stressed institution might lead to recurring calls for further capital injections. the key attributes therefore aim to provide resolution authorities with the necessary powers, allowing them to recapitalise the stressed financial institution and to avoid making use of public funds as far as practically possible. it is important for resolution authorities to have these powers to assist with orderly resolutions, but it is just as vital to put these powers to the test in a simulated page 9 of 13 scenario. to this end, simulation exercises are powerful tools to diagnose what is not working in existing crisis management regimes and to provide training in the form of „ learning by doing [UNK]. simulation exercises are therefore useful in refining conceptually adequate crisis management arrangements. simulations, especially regional crises resolution simulations, are important for a number of reasons. the resolution of a distressed financial institution in one jurisdiction can have an economic impact on other jurisdictions, especially the neighbouring countries. quick and adequate information sharing between home and host regulators is therefore critical considering that a chosen resolution option might be highly beneficial for the financial institution in distress but that it can also have a negative impact in the host jurisdiction if there is a lack of coordination between

the home and host regulators. as an example : a banking group in the home country might find it beneficial to sell off one of its banking subsidiaries in a host country as it will relieve the liquidity stress of the banking group within the home country, but the banking subsidiary might be significant in the host country [UNK] s financial sector and can therefore have far - reaching effects on the host country [UNK] s financial stability. even though cross - jurisdictional information - sharing arrangements are in place, in times of crises it is likely that jurisdictions will first act in their own best interest before considering wider regional repercussions. a regional crisis resolution simulation would therefore assist in testing the available resolution tools, the communication plans in place, and the possible knock - on crossborder effects, thus allowing regulators to be better prepared in a real - life situation by ensuring that the most appropriate solution with the most desirable intended consequences is exercised. page 10 of 13 fintech given the rapid developments in financial technology ( fintech ), it is evident that we are potentially facing one of the most severe innovation - and technology - driven disruptions to products and services, particularly in the financial sector space. regulators across the globe are grappling with understanding these technological developments and assessing the regulatory implications. we as the sarb favour a „ back to basics [UNK] approach. regulators should focus on regulatory principles that are risk - based rather than creating excessive rules - based regulations aimed at these technologies or products. for example, financial regulators do not regulate the internet, biometric technology, or mobile devices. regulatory intervention should be appropriate and should be applied to the underlying economic function. in the case of most central banks, the regulated activities should fall within the ambit of their regulatory mandate and would typically include deposit taking, payments, lending, insurance, and investments. the sarb has recently decided to establish a fintech unit, with three dedicated full - time staff members that report directly to me. this unit is required to strategically review the emergence of fintech and assess the related user cases. its primary responsibilities are expected to include the facilitation of the development of appropriate policy frameworks for the sarb across the fintech domain. this will be done by robustly analysing both the pros and the cons of emerging fintech innovations as well as the appropriate regulatory responses to these developments. besides collaborating locally, the sarb actively participates in international regulatory and standard - setting bodies. work undertaken by the various working groups at