To improve the exchange of information and the cooperation between the authorities in different countries, special agreements have been signed between the EU member states. In addition, various work is being done to ensure that the member states implement and apply relevant EC regulations in a uniform manner. All of this is good, of course, and is aimed at managing the problems and challenges I have taken up here today. But it is far from sufficient. I do not intend to go into any detailed suggestions of how the various problems should be resolved. Instead, I would just like to convey – as a contribution to continued discussions on this subject – some general thoughts on how we can proceed. BIS Review 38/2007  3  In the short term, we should make improvements primarily in three areas: Firstly, we in the EU should develop joint regulations for crisis management, which link together the responsibility for supervision and crisis management in a good way. The ultimate driving force to achieving efficient and appropriate supervision is, after all, the knowledge that one has to bear the consequences of deficiencies in supervision. Secondly, we should improve and deepen the exchange of information, cooperation and coordination between the authorities in the different countries. At present there is, for instance, no common model as to how supervisory authorities can work together. Such a model is necessary to maintain high quality and efficiency in the supervision of complex banks with operations in several countries.

This is a problem that affects not only the governments and authorities in the countries suffering crises. The arrangements for crisis management, like the supervision, affect the business conditions the banks work under. An efficiently-functioning safety net comprises a form of "quality label” on the bank system. This in turn has significance for the banks’ ability to attract customers and financiers. If legislators and authorities cannot supply this, the domestic market will lose out in competitiveness compared with other markets. The fact that there is currently a lack of joint regulations for crisis management within the EU is therefore a problem, also from the banks' perspective. Possible solutions I have now come to the fourth and final part of my speech, the part about possible solutions to the problems. Regulations, supervision and crisis management need to be developed so they can function even when banks have cross-border operations. The aim is to form a framework that can supply the need for financial stability, both nationally and internationally. It is equally important to ensure that regulations and institutional arrangements are designed so that the financial integration process can continue and the competitiveness of the European bank sector can thereby be strengthened. Considerable thought is being put into these issues at EU level right now. Some measures have already been taken. For instance, the need for a more efficient and uniform supervision of banks with cross-border operations has partly been met by giving the supervisory authority in the group’s home country strengthened powers and increased responsibility for coordination.