identify risk and what to do about it. you could see it, measure it, and fortify against it. but, as the world has changed, so have the risks that demand our attention and our resources. the new risks are harder to predict and inherently ambiguous : steel and concrete can do little to protect us. our reliance on technology means we need to think differently about cyber risk. the importance of innovation and intellectual property means we need to look for new approaches to talent and culture. and the threat posed by climate change means we need to give serious consideration to the resilience of our physical and digital infrastructure. the new york fed has the appearance of an historic institution, but behind the stone facade 1 / 2 bis central bankers'speeches we ’ re grappling with these issues in the same way that you are. in our economic research, our supervision of financial institutions, the payments systems we operate, in short – in all that we do. talent, technology, and innovation challenge us every day. they create incredible opportunity, but they also test us by exposing new vulnerabilities. i know that over the next couple of days there will be lots of valuable insights shared by experts about how to handle the challenges posed by big data, cryptocurrency, and climate change. but first, to kick off the conference, it ’ s my pleasure to introduce john dugan, chair of citigroup. citigroup has operations in over 150 countries, with about 200 million customer accounts worldwide. 2 as head of a global employer with complex, international operations, john is no stranger to the changing nature of risk. john became chair of citigroup at the start of this year. prior to that he was chair of the financial institutions group at the law firm covington & burling llp, where he spent much of his career. he has also held a number of public sector roles, including comptroller of the currency during a critical time for our financial system and economy, from 2005 – 2010. i ’ m looking forward to his insights and i know they will be the catalyst for some rich discussion. please join me in welcoming john dugan. 1 the information in this speech on the history of the new york fed ’ s headquarters building comes from about the building on the new york fed ’ s website. 2 citigroup, third quarter 2019 results and key metrics, october 15, 2019. 2 / 2 bis central bankers'speeches

for coordination and communication with the authorities of other relevant jurisdictions. in many emerging economies, this is a key issue because of the significant presence of international banks in these markets. in addition, stronger coordination and communication between authorities is vital for progress towards comprehensive or consolidated supervision of financial groups and for avoiding some of the problems detected in the recent crisis. one recommendation on which there is fairly broad agreement is to periodically review the perimeter of regulation and supervision. the traditional view that this should include only institutions taking deposits from the public has been superseded by events. the consensus view that has emerged from the recent crisis is that all institutions of systemic importance must be regulated and supervised. this also includes the obligation to provide information and disclose positions in order to ensure that markets function properly. the practical implications of this recommendation may vary from country to country, depending on the characteristics of their financial systems. there is also broad consensus that minimum capital requirements, applied on permanent bases, must be raised and strengthened as stated in the recent agreement reached by the basel committee. however, the recommendation that a capital component of a countercyclical nature be introduced raises a number of questions. what does seem interesting, although it is not explicitly included in the recent basel proposal, is the idea of having some component of contingent capital. this could be established by issuing bonds that would, under certain circumstances or conditions, become capital as, for example, if an institution ’ s capital falls below 8 % of its risk - weighted assets. another point on which there is a considerable agreement is the need to review norms and practices on liquidity management and bank funding. these had become quite lax in many jurisdictions. liquidity and refinancing risks were underestimated, particularly in the environment that preceded the crisis. the recommendations that have subsequently been put forward include a redefinition of liquid assets, the establishment of a minimum global liquidity standard, norms using time bands for the match of assets and liabilities, and higher requirements for liabilities that show greater volatility. in all these cases, there is much that central banks can contribute. the basel committee has recently undertaken to advance in defining a global liquidity standard and has fixed a calendar for this process. a robust system of provisions, based on a forward - looking rather than a backward - looking approach, can make a significant difference to the stability of the banking system. this is illustrated by the experience of emerging economies where this policy instrument is used most often and with the greatest intensity.