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WSBI Managing Director Chris De Noose
Wednesday 21 March 2018 | Banco Nación, Buenos Aires, Argentina
16:30 Argentina Time
Dear representatives of the G20 community,
Dear WSBI members,
Ladies and Gentlemen,
We had a most fruitful day today. Wouldn’t you agree? We had great discussions and presentations on how WSBI and its members can increase financial inclusion and stimulate economic and social development. We examined in detail which opportunities the Argentinian G20 presidency offers for the continent.
We discussed how better regulation can lead to better inclusion. We debated about the need to build a financial ecosystem that is adapted to the digital age. We focused on how sustainable finance can become an engine for economic growth. We did a lot AND we learned a lot.
That said, I would like to conclude this conference by stressing that everything that has been said here concerns you – savings and retail banks. That means locally focused banks here in Argentina, in El Salvador, in Colombia, in Spain or in any other country represented here.
Let me explain briefly before we adjourn. On banking rules, regulation and supervision are at the heart of any financial institution. The ministers of finance, the governors of central banks and all the experts that work with and for them are talking about capital requirements and liquidity buffers, they are checking your balance sheet line by line – item by item – and they will do whatever it takes to avoid that the taxpayer – the voter – will ever have to bail out the banks again.
It’s logical and good policy. Taxpayers should not have to bail out the banks. But as the American statesman and inventor Ben Franklin once said, “an ounce of prevention is worth a pound of cure”. Banks should avoid getting into trouble in the first place. That is what banking and retail banking, in particular, is about. It is about trust. It is about prudence. It is about short-term action and long-term, sustainable banking.
Some may say they “don’t like” their bank, but they continue to bank on them, putting their hard-earned money in that bank because you know that it is the safest place to put it. It is certainly safer there than in their mattress. On the lending side, they still choose to take a loan from the bank because you know that locally focused banks respect rules concerning consumer protection. They trust their bank manager as someone who understands the local economy, local people and local needs.
That is what retail banking and savings banking is about. That is what our members in Latin America do. That’s what our members in Africa and Asia do. That’s what our members do all over the globe. For two centuries to boot.
It’s a simple yet elegant story. Locally focused banks collect and safe-guard deposits, converting these deposits into loans to households, micro-, small and medium-sized enterprises and local authorities. Banks are businesses too. To remain sustainable, they keep their eye on making a fair return. It’s clear as day. Why? Because a company that does not make profit is doomed to disappear sooner rather than later. To go a bit deeper, making profit is however not the only goal of a retail or a savings bank. Their aim is also to return a part of that profit to the local society they belong to. The local community is our home, it is what makes our WSBI members thrive. By reinvesting a part of our profits in the local community we create a positive feedback loop and this is what makes our model so solid.
Ladies and Gentlemen, when you meet a stranger, one of the first questions that you will get is “What do you do for a living?” When you reply “I am a banker”, you often get today a bit of backlash, as if every banker is a kind of a “Wolf of Wall Street”, a person seeking only profit, at any cost.
That perception must change. I would like people to connect retail bankers with all the good they bring – a positive force. A force that allows companies to grow, to invest, to employ people, to eradicate poverty. . A force that allows municipalities and local authorities to build schools, sports infrastructure, hospitals for the citizens. A force that protects the life savings of households and makes it possible for them to realize their dreams by granting loans for education, for housing. A force that contributes to make our society more sustainable and brings welfare for all layers of the population.
We are that force, Ladies and Gentlemen, and we need to make sure that every regulator and every supervisor of the G20 community is aware of this. Regulation and supervision has its place, but we need a regulation that takes into account our special nature and the communities they serve. We embrace digitization and innovation. For decades, the banking sector has been the biggest investor in IT software and hardware and we will continue to invest. But we want technology companies, Fintechs, to respect the same rules that we have to respect in how we connect with the customers, either online, mobile or tablet.
Ladies and Gentlemen, I was told that this beautiful city of Buenos Aires has its name because the Spanish sailors that set foot here dedicated the town to our Lady of Favorable Winds, to thank her for the safe journey they made. I am hoping today also for favorable winds. Not only to get safely home, I am also hoping that after the “hurricane” of the crises and the regulatory rage that followed, we will soon sail on an ocean with favorable winds for retail banking. I think that today we have been able to show that WSBI and its members can be a force that helps make our society more sustainable. I trust that we can continue this endeavor in the future.
Let me conclude by thanking our host, and new WSBI Member, Banco de la Nación Argentina for the great help in the organization of this conference and for hosting us in this magnificent setting. A big thanks also to the other sponsors of this event, Banco Caja Social, our member in Colombia, Fedecrédito, our member in El Salvador and last but certainly not least CaixaBank, our member from Spain.
Obviously also a sincere thank you to all of you, participants, speakers, panelists, translators and all those that contributed to the success of this event. Thanks for being here and for being part of the worldwide community of savings and retail bankers.
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