likely that the focus on supervisory outcomes will be given even greater weight as a result – supervisory engagement is all to the good, but only so far as it leads to successful, transformative outcomes. observers may sometimes suggest that our calibration of prism overemphasizes the high impact firms at the expense of assigning fewer resources to low and medium low impact firms. probably that is not the majority view in the present audience, and i think it is clearly wrong during this period of post - crisis repair of the main firms. however, it is something which we are keeping under review. our engagement model will also evolve in tandem with european developments. the convergence of prudential supervisory practice and enforcement policy has long been talked about and stated as a worthy aim, while national supervisory authorities went about their ordinary business. only colleges of supervisors, for internationally active insurance and banking groups, gave a modicum of substance to this aim. but the time of actual common supervisory practice and enforcement, as set out by european authorities with the powers and the resources to ensure adherence, is about to come. for euro area banking supervision, the ssm is actively writing a supervisory manual which already runs to 700 pages, and it has commenced the recruitment of staff in frankfurt to implement the model in the banks it will supervise. much of the prism model approach and reasoning has been taken on board by the ssm ; it will have been one of the main precursors of the ssm approach – but it will be superseded like all national models by the single euro area supervisory approach in banking. bis central bankers ’ speeches in insurance, convergence will not be as strong nor come as fast. there is no institution that can play the role of the ecb, and solvency ii will come into force two years after crd 4. yet, in the coming years, eiopa will endeavour to work on increased convergence of supervisory practices. eiopa and its staff will step up its review of national approaches, and will likely develop a cohesive supervisory manual for insurance in europe. enforcement for supervision to be successful it must be underpinned by an appropriate recourse to enforcement. enforcement is a necessary component of any effective regulatory framework. where regulated entities fail to comply with their regulatory requirements, enforcement is an important tool to effect deterrence, achieve compliance and promote the behaviours and high standards that we expect. we aim, through our approach, to leave little doubt that where there is clear evidence of regulatory breach

supervision, one to specialist expertise, and a wholly new third division carries out onsite inspections year round. this structure aligns the central bank with the organisational requirements of the ssm and further enhances our supervision. let me conclude by restating a few key messages. in our country, the institutional arrangement of financial regulation, the engagement framework and practice of prudential banking supervision were overhauled during the tenure of mr. elderfield in the wake of our domestic banking crisis. as of 2013, much repair had been achieved. on the european stage, the lessons of the global banking crisis resulted in an overhaul of regulation, supervision and resolution that has started unfolding at the end of 2013. while the efsf was put in place in 2011, the crd iv, crr and brrd come gradually into force from 2014 up to the end of the decade, the ssm is operational since november 2014 and the srb will assume its functions in january 2016. these new european regulations and institutional arrangements have in the main superseded the domestic response of the 2010 – 2013 to our national banking crisis and are designed to address the challenges of public banking oversight and resolution at a european level, in lieu of national decision - making that prevailed until 2013. thank you. bis central bankers ’ speeches