The Bangko Sentral ng Pilipinas (BSP) and the International Monetary Fund (IMF) co-hosted the 2024 Systemic Risk Dialogue held recently in Mactan, Cebu.
BSP Governor Eli M. Remolona, Jr. noted that the organizers deliberately took “the road less travelled” by focusing on the non-bank financial sector and the emerging technological innovations.
Remolona noted that there are many aspects of systemic risk that the conference explored.
The discussion on the non-bank financial sector, for example, recognized that “there is much diversity within [this] sector, just as there are interlinkages between non-banks and banks.”
Remolona likewise described technology as “an enabler for the non-bank financial market,… something that banks have embraced, and… is redefining the demands of the consumer.”
Apart from possible contagion risks, Remolona also cited communication as an important initiative.
He has frequently warned of “false narratives” and in this conference he added that “without proper communication, we risk sharp reactions from stakeholders, creating the cliff effects that we certainly wish to avoid.”
Audio-Visual Presentations (AVPs) prepared for the conference indicated that non-bank intermediation has grown significantly since the Global Financial Crisis.
Estimates show that it is already as large as banking intermediation at the global stage. These AVPs also pointed out that technology benefits financial consumers, but it also asks the financial authorities to revisit key central bank functions.
This dialogue brought together a wide range of market stakeholders. Senior financial authorities were joined by corporate CEOs, market practitioners and analysts, bankers, economists, as well as officials from regional and global multilateral agencies.
Structured as a series of coffee-table discussions, the conference also benefitted from the insights of former Bank of Japan Governor Haruhiko Kuroda who delivered the keynote address.
