“Brevity is the soul of wit,” wrote Shakespeare. If so, then being a bank regulator can’t be that entertaining these days. With the huge growth in reporting requirements, bank supervisors receive reading material that is the equivalent of reading twice the complete works of the Bard each week, or so I found while working on the Bank of England’s (BoE) Future of Finance report. It underscored the vital role that machine learning and data analytics will play as part of a digitally enabled regulator of the future. But how else is financial regulation likely to change as a result of the technological revolution that is under way?
In 2018, BoE governor Mark Carney asked me to lead a review of the UK’s financial system to strengthen the central bank’s agenda, toolkit and capabilities. I focused on three questions: how can technology increase finance’s resilience? How can finance support the transitions we are witnessing? And how can finance serve the digital economy? It was an extraordinarily challenging set of questions and led me to some of the big debates regarding how technology will affect finance over the coming years. Let me pick out a few aspects.
