And here comes the BOJ

Good morning. Thank you for joining us at this year's Future of Banking conference. I'm pleased to see so many community bank leaders gathered here today. Your presence reflects a shared commitment to understanding how our industry is evolving and how institutions can position themselves to thrive in the years ahead. When we talk about the "future of banking," it's tempting to think we're discussing something distant or theoretical. But the reality is that the future is already here. Many of the innovations that will define banking in the coming decade are already proven, operational, and creating opportunities for early adopters. My message today centers on how leveraging foundational infrastructure—particularly instant payments—can strengthen competitive positioning while maintaining the trust and relationships that have always been the hallmark of community banking. This isn't about abandoning, or even distracting from, what makes community banks special. It's about accessing technological innovation to further deliver on community banking’s promise and potential. I'll begin with my perspective on the economic environment, then discuss how technology is reshaping dynamics in banking, and finally examine how instant payments, and the Federal Reserve's FedNow Service in particular, provides infrastructure that community banks can leverage. My goal is to make clear that the path forward Fed's Schmid: The job market is functioning effectively. Fed's Schmid: Continued inflation is most pressing risk to economy, clear that it is still too high. Fed's Schmid: Conditions fundamentally sound in banking sector.