Key Points
      •  Profound changes in Global Economy and Financial Structure from 
         financial innovation, deregulation, globalization and technology forces 
         us to re-think how to handle FAILURE -  such as crisis management and 
         restructuring of financial institutions.  
      •  GFC showed inter-locking, inter-dependency between banks, shadow 
         banks, stock and real estate markets, driven by debt, derivatives, 
         political and “capture” linkages.   
      •  Huge complexities and uncertainties from geo-politics, climate 
         change, demographics, technology, and feedback from Big Data, social 
         media.   These challenge formulation of monetary policy, regulatory 
         reforms and market structures
      •  Need changes in mindsets, governance, new measures of 
         inter-connected behaviour (social media) and new data-sets
      •  But the process of how to diagnose, control damage from 
         failing banks, allocating losses and changing incentives 
         remain true.  We just need to adapt these processes and tools to 
         our national conditions. 
     Section 1 Digital Disruption
           Megatrends in Technology and Business 
           Models – KNOW YOUR CONTEXT
    Digital Component has Growing Share of Global 
    Flows
  Share of selected cross-border flows that are digital, %
 Note: 1 Based on China data; 2 Excludes other VOIP minutes; 3 Based on US data.
 Data sources: iResearch; Telegeography; OECD; US Bureau of Economic Analysis; McKinsey Global Institute analysis
 Source: McKinsey Global Institute. 2014. “Global Flows in a Digital Age.”
    Four Impacts of Technology on Business Models
    1. Competition intensified. Technology disintermediates conventional business – 
      cheaper, faster, global
    2. Demographics shifted. Customer older, more women and millennials to control 
      large share of buying power
    3. Clients have new expectations: Want more trustworthy, better transparency, 
      lower fees.  Social Media spread can improve or damage Brand reputation  (e.g 
      United Airlines Dr. Dao reputation issue)
    4. Regulation. Complex regulations – cyber-security, anti-money laundering, tax 
      evasion, corruption laws, cyber-security all impose huge burden on corporate 
      compliance and reputation
    Digital Dividend:  Consumer Surplus – Labour Deficit 
    =    Job Disruption/Inequality + Populism
    Digitization causes losses in economy (NPLs from NPAs) that makes even banks also 
    suffer loss of business and credit losses!
 Source: Accenture. 2016. "Future of Wealth Management."
     Global Risks Interconnections Map 2017
     Risks are dynamically connected and unpredictable
 Source: WEF. 2017. "The Global Risks Report 2017, 12th Edition."