financial services in a smooth, safe and efficient way? european infrastructures for securities clearing and settlement, as well as those for retail payments, remain highly fragmented, which makes cross - border transactions in these areas very costly. this is widely recognised as a major contributor to the fact that the european markets for corporate bonds, equity and retail payments are still not integrated to a satisfactory degree. it should be emphasised here that when financial markets are not fully integrated, not only does this imply substantial economic cost in terms of a less efficient allocation of financial resources, which consequently limits opportunities for economic growth in europe, but this can also be associated with financial risk. fragmentation of the financial markets has negative implications in particular for the financial system ’ s overall capacity to absorb shocks, since it reduces the opportunities for risk - sharing and diversification among economic agents and limits the depth and liquidity of financial markets. therefore, from the perspective of both financial efficiency and financial stability, financial integration is a key issue. european infrastructures should not only be well - integrated ; they also need to meet the highest standards in terms of risk management and resilience. indeed, it is critical that market infrastructures are robust in order to reduce systemic risk in the financial system. after all, the failure of a clearing, payment or settlement system is likely to cause major disruption to the underlying trading processes, thus putting wider financial stability at risk. therefore, the reliable functioning of market infrastructures is indispensable for a stable financial system, complementing the soundness of financial institutions and markets. while it is the operators of these infrastructures that are primarily responsible for taking the appropriate measures to ensure this reliable functioning, specific regulatory and oversight requirements are also in place to ensure that the infrastructures are designed to be robust and are operated in an effective manner. the challenges posed by the current ongoing turbulences in financial markets underscore the importance of not just continuing but of stepping - up financial integration efforts. fostering the integration of market infrastructures : target2 - securities and the single euro payments area i would now like to take a closer look at work which is under way to foster the integration of european market infrastructures, namely in the fields of securities clearing and settlement, and retail payments. as you are aware, a number of initiatives have recently been adopted or are currently under way with a view to achieving progress in these fields, led by both market participants and public authorities. today i will focus on two major projects featuring on

sabine lautenschlager : risks to banks - from inside and out speech by ms sabine lautenschlager, member of the executive board of the european central bank and vice - chair of the supervisory board of the european central bank, at the 14th asiapacific high - level meeting on banking supervision, sydney, 13 february 2019. * * * ladies and gentlemen, it is a pleasure to be here today! and not only because it allows me to escape the cold german winter, but also because this meeting allows us to share views from opposite ends of the world – views from asia and australia and views from europe. the crisis has shown how important it is to do just that. how important it is to be aware of what ’ s going on elsewhere, of how closely markets and market participants are interconnected. after all, a crisis that breaks out on one side of the globe can quickly spread to the other. so, being aware is one thing. but the crisis forced us to go further ; it forced us to join forces – not only in overcoming problems as they arose, but also in revamping the regulatory and supervisory framework afterwards. this happened at the global level – basel iii – and at the regional level. in europe, policymakers went further than anywhere else. at the height of the crisis, they decided to set up a banking union. the first step was to take banking supervision from the national to the european level. so, in 2014, the ecb became responsible for supervising banks in the euro area. has this worked out? i still remember that, back in 2014, i heard quite a few critical voices. not everyone believed that european banking supervision would actually work. four years later, this has changed. european banking supervision has been set up, it is running smoothly, and it contributes to making banks safer and sounder. but it was quite some job, i can tell you. i remember the early days, when we were just a handful of people sitting in a half - deserted building in frankfurt. i remember how we began to hire staff – around 1, 000 – for the ecb, and how we began to bring together the supervisors in national authorities, supporting them in adopting the new european supervisory approach. i remember the comprehensive assessment we carried out on the banks that we would later supervise. we were like a start - up ; we still are, in fact. we are constantly innovating, learning and growing together as a european team of