; 1995 - 1999 : 31. 6 % ; 2000 - 2004 : 42. 4 % ). although we have witnessed an increasing proportion of cross - border m & a activities in the eu banking sector since the introduction of the euro, there is still a lack of pan - european banks. consolidation in the banking sector is mostly domestic. the presence of pan - european banking groups ’ branches or subsidiaries in the eu countries is quite limited – even if there is a lot of representation of it in this conference room today. the average share of foreign branches and subsidiaries accounts for approximately 25 % of the eu banking market. higher figures can be found in some smaller countries, such as the benelux, and very high figures in many new member states with the market share of foreign - owned banks exceeding 95 % in the czech republic, slovakia, estonia and lithuania. the lack of retail market integration in banking, of course, reflects to some extent the fact that retail banking is a local business where proximity to clients and knowledge of cultural attitudes is of special importance. but it might also mirror possible impediments to cross - border m & as. it is sometimes argued that the supervisory environment poses such an impediment. and some experiences over the past couple of months have certainly not dampened such fears. in general, public policy should not interfere with market - driven cross - border merger processes but remove potential supervisory obstacles. and, somewhat encouragingly, according to a recent ( cebs ) survey of european banks. the current supervisory framework is not really substantially hindering european cross - border banking consolidation. it is clear, however, that the current state of play poses a number of real challenges for banking supervisors. firstly, as long as we do not see pan - european banks on a larger scale, there is no justification for a pan - european supervisory body or what is known as a “ lead supervisor ”. secondly, emerging cross - border structures mean that the legitimate interests of home and host country supervisory authorities have to be balanced without burdening the involved banks too heavily with bureaucratic costs. in striking that balance, convergence and cooperation in supervisory practices are inevitable. and further harmonisation of supervisory rules in europe may be required to ease the cross - border activities of credit institutions. and there is indeed a lot of work going on in the relevant institutions, such as cebs or bsc. some examples may justify this claim : ( i ) the implementation of the crd, which i have mentioned, will

support these initiatives. whatever the outcome of the technical work, the instrument should be designed in line with the fsb guiding principles. this means : it should only be available on a temporary basis, when private funding sources are insufficient, on conditions that minimize moral hazard. concluding remarks when looking at the progress made on bank resolvability, i can say that from an fsb perspective the glass is half full and that i remain optimistic. much progress has been made on resolution planning, tlac and funding in resolution. this has helped to increase the resolvability of the banks and the preparedness of the authorities. the challenge will be to keep up the good work. this means banks should invest in improving their capabilities to execute the resolution strategy. authorities need to continue to provide the banks with guidance and make sure they are operationally ready for a resolution case. i hope i can count on your efforts in this endeavour of making your banks resolvable, especially in the areas of operational continuity, tlac and funding in resolution. thank you!