a consolidated basis, current fiscal budget plans are not sufficiently ambitious in view of the favourable economic prospects. let me now give the floor to the vice - president to say a few words about other issues discussed by the governing council. first, i should like to address the euro banknote - related issue concerning the determination of the number of banknotes to be printed before the launch date of 1 january 2002. the latest forecast shows that there will be a need to put 14 billion euro banknotes into circulation, compared with last year ’ s estimate of 13 billion. the increase can be attributed to three main factors : a higher than expected figure for national banknotes in circulation, which forms the basis of estimates of the launch stocks ; a higher forecast for the use of low - denomination banknotes ; and a somewhat slower than previously expected development in the use of electronic money. second, the governing council also had an exchange of views on recent developments in the eu banking industry. the discussion was based on preparatory work by the banking supervision committee. the governing council is well aware that the current process of consolidation is no longer confined to small and medium - sized banks - as it was in the past - but that now it also covers the larger banks at the national level and cross - border mergers and alliances are on the increase. the role of the euro as a factor encouraging this process of consolidation via further integration of money and capital markets is important. the consolidation process is welcome in general since it allows efficiency gains to be achieved in the banking sector. on the other hand, it affects the competitive environment in which banks operate, as well as their risk profile. therefore, a careful monitoring on the part of the public authorities responsible for prudential supervision and financial stability is required. the governing council decided that a report on mergers and acquisitions involving the eu banking industry be prepared for publication in the autumn.

of the analysis of policy issues relating to financial regulation and supervision, financial stability arrangements ( e. g. financial crisis management and resolution ) and other financial services areas ( e. g. accounting ). this work encompasses the regular monitoring and assessment of developments in these areas as well as contributing to european and international discussions on regulatory and supervisory issues. this three - pronged approach allows us to focus on the distinct but complementary activities related to financial stability surveillance, systemic risk assessment and policy responses, respectively, while still ensuring that interlinkages between these elements are considered in bis central bankers ’ speeches an integrated manner when providing financial stability advice to the decision - making bodies of the eurosystem, the european systemic risk board and to the wider public. the ecb financial stability review is only one example of product where the three elements are developed. we are living difficult times and need state of the art tools and indicators for analysis. as mentioned before, we are currently living in an extremely complex and difficult macroeconomic situation. the financial crisis, if anything, revealed that we need to understand much better the interactions between the financial and real economic sectors. particularly, the concepts and analytical tools underlying financial stability and macro - prudential analysis were found somewhat deficient to properly guide policymakers trying to steer through the crisis. this has underlined the need for “ state - of - the - art ” tools and indicators for conducting financial stability analysis. indeed, especially during the past five years the academic research has very much enhanced the analytical toolbox that we have available to properly analyse and assess the pertinent financial stability issues of the day. further enhancements are, of course, needed and i can only encourage the academic community to continue in this direction as it will greatly help policy makers when trying to understand and ultimately address financial stability issues of a systemic nature. also in this light, it is my expectation that today and tomorrow ’ s conference will provide us with cutting - edge research in the financial stability area ; thus providing a highly useful stock taking of the progress made in recent years, while ideally also pointing towards areas where further improvements are still needed. need to rethink also policies and policy frameworks the conference will conclude with a panel discussion on macro - prudential policies. key questions in this area include the translation of systemic risk analysis into concrete policy actions and the related challenge of developing a well - functioning macro - prudential policy toolkit. in this regard, we have to ensure that once