On 24 January 2023, the ILF hosted its 11th Conference on the Future of the Financial Sector, co-chaired by Andreas Dombret and Patrick Kenadjian, in conjunction with Knowledge Partner Oliver Wyman and with the support of Amazon Web Services, on the topic of "The Next Systemic Financial Crisis – Where might it come from?: Financial Stability in a Polycrisis World".
The daylong conference brought together prominent representatives of the public sector, including the Chair of the Financial Stability Board, the Acting Comptroller of the Currency of the US, the Head of the BIS Innovation Hub, the Secretary General of IOSCO, a Commissioner of the US Commodity Futures Trading Commission, the Chairperson of the European Banking Authority, a member of the Supervisory Board of the European Central Bank, the Deputy General Manager of the Bank for International Settlements, and distinguished representatives of the private sector.
The scheduled topics covered macroeconomic factors, crypto assets and cyber security, non-bank financial institutions and regulated financial service providers, but concerns about climate change, which had been the focus of our ninth conference, liquidity and NBFIs permeated the discussion, including a lively debate across several panels about the need to reform government securities markets and not just NBFIs to bring stability to those markets.
There was general agreement that we could reasonably discuss and strive to plan for ‘known knowns’ and ‘known unknowns’, but that the presence of ‘unknown unknowns’, as well as gaps in our knowledge of markets and the motivations of some market actors, together with the potential for interaction of individual risks in the context of a ‘polycrisis’, place limits on preventive action and that vigilance remains the order of the day, even in sectors like regulated financial service providers, which have recently raised fewer concerns than cyber assets and NBFIs.