Opening remarks at the 2026 IADI Annual Conference
Opening remarks by Alejandro López, IADI President and Chair of the Executive Council, on the 2026 IADi Annual Conference.
Ladies and gentlemen, dear colleagues and friends,
Good morning.
It is a pleasure to be here with you in Berlin for this IADI Annual Conference. I would like to thank our hosts, the Compensation Scheme of German Private Banks and the Deposit Protection Fund of the Association of German Banks, for their hospitality and for the work they have put into organising this gathering.
I would also like to congratulate the Deposit Protection Fund on its fiftieth anniversary. This anniversary gives us an opportunity to reflect on the value of the institutions we have built and on our responsibility to ensure that they remain effective as circumstances change.
The theme of this conference, strengthening the financial safety net in the digital age, raises a question that I would like to leave open for our discussions: what must we preserve, and what must we change, to remain worthy of depositors’ trust?
We are all aware of the changes taking place in the financial industry. Transactions are becoming faster, new intermediaries are emerging, and people are managing their money through services that are increasingly integrated into their daily lives.
These developments have broadened access and improved the experience of millions of users. They have also changed people’s expectations. Round-the-clock availability and speed are now standard features of financial services.
Yet that experience can obscure a fundamental distinction. The ease with which people use their money does not necessarily tell them what stands behind it.
An application may work well, display a balance and allow instant transfers. None of these features, on its own, tells us what will happen to the funds if the institution managing them fails.
For those of us who are part of the financial safety net, that distinction is central. It is the starting point for the reflection I would like to share.
Pablo Hernández de Cos has pointed out that money is an institutional achievement. Its acceptance rests on an architecture that allows us to use it without having to examine, in every transaction, the quality of the promise to pay that we receive.
I believe that this provides a useful basis for thinking about our work.
The confidence that allows the financial system to function rests on institutions, rules and capabilities built over time. These institutions allow people to go about their daily activities without continually having to assess all the risks behind each transaction.
I would like to apply that reasoning to deposits.
A deposit is a liability of the institution that accepts it. However, the confidence that allows people to use it for saving, receiving payments and making payments rests on a foundation that extends beyond that institution.
Regulation establishes obligations. Supervision must verify compliance and intervene in a timely manner. Resolution mechanisms allow an institution’s failure to be managed. Deposit insurance protects the depositor, within the established terms, when the bank can no longer meet its obligations.
The guarantee shows this institutional dimension particularly clearly. It is designed to operate precisely when the deposit-taking institution fails.
That is why I propose that we recognise the guarantee as a constitutive element of the confidence associated with deposits. When we speak of deposits, we must also recognise the institutional arrangements behind them. Those arrangements sustain confidence beyond the circumstances of any individual bank.
Coverage has limits and exclusions. These conditions define the scope of protection and allocate responsibilities. Within that scope, the guarantee continues to perform an essential function for the system as a whole.
This has implications for the way we approach innovation.
We must be careful when defining new financial arrangements. The terms we use create expectations. If we call an instrument a deposit, users may associate it with the protection they expect from that word.
A balance in an electronic wallet does not, by itself, constitute a bank deposit. The wallet may provide access to a deposit, or it may represent a claim of a different nature. We must establish who is liable for the funds, what claim the user holds and what protection is available in the event of insolvency.
The speed of an application does not answer these questions. Nor does the similarity between the functions offered by different products.
When that similarity creates an expectation of a guarantee without the backing to support it, confidence is put at risk. If that expectation is not met, the effectiveness of protection mechanisms may also be affected.
Making this distinction clear is a shared institutional responsibility.
It falls to deposit insurers, regulators and supervisors, as well as to financial institutions that accept deposits or participate in these arrangements. Each, within its own role, must help ensure consistency between the product’s designation, the user’s rights and the protection that can be delivered.
The IADI Core Principles provide a reference point for this work. They link protection to membership and supervision requirements, call for clarity on coverage, and recognise the importance of public awareness of its benefits and limitations.
Their value lies in helping us examine whether the backing we communicate exists and can operate effectively. They should guide our decisions as we review products, institutions and procedures in response to digitalisation.
That examination must also consider whom we are asking to assess the risks.
There is an information asymmetry between institutions and their depositors. We are well aware of its implications. An institution has information about its exposures and liquidity that its customers do not possess. Even when public information is available, people’s ability to interpret it varies considerably.
Most households and small businesses do not have the resources to analyse their bank’s financial condition continually.
We therefore need to be realistic when discussing market discipline. Its effectiveness depends on the ability to identify risk, understand it and act on it. Exposure to losses does not automatically produce informed discipline.
This matters when determining the level of coverage.
The entire protection framework must also be known and understood.
Depositors should not be expected to master prudential rules or supervisory and resolution procedures. They need to know that the institutions responsible for the financial safety net will continue to act if their bank fails.
For depositors, that backing becomes tangible through knowledge of the guarantee: who protects their money, up to what amount and how they will be able to recover it.
This knowledge allows their confidence to extend beyond the deposit-taking institution. They understand that protection remains in place when the institution can no longer meet its obligations.
That is why communication is part of our responsibility to protect. We must ensure that users understand the information they receive and can distinguish between a deposit and funds placed in a wallet without equivalent protection.
Certainty about the guarantee helps correct the confusion between a satisfactory digital experience and effective protection.
But there comes a point when that certainty must produce a result.
When an institution fails, depositors need to recover their money. This brings us to the challenge I would particularly like to emphasise: time.
For someone who must meet household expenses, or for a business that needs to pay wages, knowing that a deposit is covered may not be enough if the funds cannot be accessed.
The guarantee has both a financial dimension and a time dimension. We must address both.
The digital experience has created an expectation of immediacy. People transfer funds, receive payments and make payments within seconds. It is understandable that, when they need protection, they expect a response consistent with that everyday experience.
This raises the demands placed on us. We must minimise the time between the guarantee being triggered and effective access to funds, while communicating time frames that we can meet.
A delay prolongs uncertainty. It can also weaken the credibility of a mechanism that is legally and financially sound.
Modernisation must therefore focus on our capacity to respond.
This leads us to examine our own institutions. We have different mandates and operate through organisations that may be public, private or mixed. That diversity influences how we work, but none of these characteristics, on its own, guarantees the effectiveness of the guarantee.
We must ask whether we receive sufficient and reliable information in a timely manner, whether early-intervention mechanisms exist, whether responsibilities are clear, and whether those who must take decisions can do so free from conflicts of interest.
A deposit insurer may have the necessary resources and powers, but its capacity is weakened if data arrive late or decisions are delayed. Similarly, a limited mandate requires arrangements that allow the institution to prepare in good time for the tasks within its remit.
Dear colleagues,
Our institutions have a valuable track record. That experience gives us knowledge and responsibilities, but confidence must continue to be supported by results.
New technologies also offer significant capabilities. Their value for protection will depend on how effectively we incorporate them into our institutional arrangements.
Our shared task is to preserve conceptual clarity and improve the effectiveness of our responses. We must be prudent when recognising new instruments, set appropriate coverage and prepare carefully to deliver that protection.
I hope this conference will help us move in that direction. I hope it will allow us to compare experiences, identify gaps and take away concrete decisions that strengthen our joint work.
Depositors’ confidence rests on backing that extends beyond their bank. Our responsibility is to ensure that this backing is known, credible and effective.
Its most tangible test will come when someone needs to recover their funds. Much of the confidence we must preserve depends on our ability to respond safely and urgently.
Thank you very much.