##ally important institutions, i. e. those whose complexity, size and interconnectedness are such that their failure could cause serious problems to the global financial system. this new framework rests on four pillars : additional loss absorbency, effective resolution mechanisms, increased supervisory intensity and more resilient financial market infrastructure. unquestionable progress has been made in implementing this framework. in particular, the g - 20 has approved, as a new international standard, the so - called key attributes of effective resolution regimes for financial institutions, which have to be complied with in each jurisdiction. in spain, law 9 / 2012 adopts and applies many of the principles set forth in the “ key attributes ”. meanwhile, the european union expects to adopt the bank recovery and resolution directive by the end of the year, which will be an important step forward in fully implementing the “ key attributes ” in all member states. on this last point, as you know ecofin is currently discussing the single resolution mechanism and the resolution fund. it seems that agreements, or draft agreements, are being reached and that progress is being made in the area of resolution, such as the determination of the competent authority. also, in the more difficult and complicated issue of financing, headway is being made on the characteristics of the proposed single resolution fund. negotiations are following their course and an extraordinary ecofin meeting is scheduled for next week to address these matters. let me now look at the new powers assigned to the banco de espana in the draft bill on credit institution supervision and solvency to be debated shortly. bis central bankers ’ speeches obviously all the functions and powers conferred on the banco de espana, which i will describe shortly, will have to be interpreted and implemented taking into account the powers of the european central bank in the framework of the implementation of the single supervisory mechanism. from the formal standpoint, the draft bill will consolidate in a kind of “ bank code ” all the regulatory provisions on the creation, activity and control of credit institutions, thus putting an end to the dispersion of legislation which has characterised the credit sector for various decades. furthermore, the aforementioned consolidation aims to write into spanish law the changes introduced in june 2013 by the so - called crd - iv package, i. e. the directive and the regulation which incorporate the basel iii accord into european legislation. as you know, that transposition has been partly handled by the promulgation of royal decree - law 14 / 2013, which includes those matters considered essential for incorporation

least in the basel committee, as an agreement on its design and calibration has already been reached. the short - term ratio will not come into force immediately. it will be phased in from 2015 – when a level of 60 % will be demanded – to 2019, when it will reach 100 %. nonetheless, this timetable may be speeded up at the discretion of the different national authorities. the banco de espana has backed the setting of the short - term liquidity ratio, and the amendments to it, which have softened the original framework proposed. nor does it intend to accelerate the implementation timetable, although we believe that banks should strive to meet it as soon as possible. as regards reporting and transparency obligations, we consider they should be obligatory for internationally active banks, but that they could be simplified for others. basel iii also envisages the implementation of a long - term liquidity ratio so that banks maintain stable funding profiles, tailored to their assets and activities. in that way, banks ’ dependence on short - term funding markets is structurally reduced, since that proved to be a very disruptive weakness in the 2008 financial crisis. the design of this ratio is at a relatively early stage, as the preliminary proposal published in 2010 is being revised. it is expected that, early next year, a consultative document will be available, and that the regulations will have been finalised before 2015, with this entailing a simplification of the original rule. further, it will be necessary to agree on certain aspects of relevance for spanish banks, such as, in relation to liquidity requirements, the treatment of high - quality mortgages or matters pertaining to asset encumbrance. this ratio is expected to come into force in 2018, although in the case of the eu, the commission will have to submit a legislative proposal before 2016. i shall now move on to certain elements relating to the review of capital requirements. this is part of a broader project : to attempt to ensure that the benefits of risk - adjusted regulations, such as basel iii, are not achieved at the cost of introducing excessively complex regulations which, in addition to other problems, yield results that cannot be compared from one bank to another. the banco de espana is in favour of simplifying the current regulations, striking a balance between simplicity, comparability and risk - sensitivity. in this respect, it views favourably the transparency exercise conducted by the basel committee on the comparability of asset risk weights. the results of this