instruments that can cover losses if the bank should fail ( gone concern ) – for example, unsecured debts with long maturities that cannot be redeemed. the crisis has shown that, above all, it is common equity tier 1 that can be counted on when the tide turns for the worse. all in all, the banks ’ capital position will be strengthened considerably compared with previous regulations, contributing to the boosting of confidence in the individual banks and in the system as a whole. … clear measures for liquidity … in the autumn of 2008, we saw how a lack of confidence in the financial markets rapidly led to liquidity problems. so one priority for increasing financial stability has been to ensure the banks are able to manage liquidity problems in the short and long terms. the basel committee is thus introducing quantitative liquidity requirements for banks for the first time. basel iii works with two liquidity measures – one short - term and one long - term. the shortterm measure is based on, in principle, every bank having sufficient liquid assets to survive for at least 30 days. it is difficult to see such a requirement as unreasonable. the long - term measure, in principle, limits the gap between the maturity of a bank ’ s assets and the maturity of its debts. this limits the duration risk of the bank. … and particularly the regulation of systemically - important banks a particular focus has been placed on systemic risks and the most systemically - important institutions. to a great extent, this is a work in progress. so far, the basel committee has in principle, basel iii defines common equity tier 1 as share capital and previous profits. bis central bankers ’ speeches identified almost 30 global systemically - important banks ( g - sibs ). the list was published last week and includes one of the major swedish banks, as you may have noticed. the committee feels that it is particularly important that these banks have extra strong resilience. those identified as g - sibs should thus have an additional capital buffer, the size of which depends on how systemically important each bank is deemed to be on a global level. a framework should be put in place for how the authorities in different countries should handle them if they find themselves teetering on the brink. in addition, the supervision of these banks should be particularly intensive. work to identify which banks are systemically important on the regional and national levels will also start soon. this work is, of course, particularly interesting for us in sweden

. conditions in sweden should be considered in the implementation of basel iii the regulations i have just sketched will eventually enter the national legislation. they are to be fully implemented by 2019, with several milestones on the way. the basel committee has been clear that the regulations and the implementation of them form a minimum standard. financial systems differ from country to country and so there may be reason for certain countries to place higher demands than have been placed globally. the swedish banking system is distinguished by a number of characteristics that make it somewhat special from an international perspective – characteristics that either increase the risk of problems or the socioeconomic costs if problems should arise in the banking sector. some of these characteristics are that the banking system is concentrated, large and international, with significant implicit state guarantees, a heavy dependence on market funding, particularly in foreign currency, and low risk weightings. the swedish banking system is concentrated the swedish banking system is highly concentrated. the four major banks stand for about three - quarters of both lending and deposits. the major swedish banks have large exposures to one another, primarily through interbank loans and holdings of covered bonds. risks arising in a single bank ’ s operations can thereby easily be spread to the other major banks. during the crisis, we also saw how uncertainty over future loan losses in individual banks spilled over to the others. in the eyes of a foreign investor, the swedish banks were all travelling on the motorway in the same vehicle. swedish banks are large and internationally dependent the swedish banks are also large in relation to the swedish economy. the assets in the total banking sector are equivalent to about 425 per cent of sweden ’ s gdp. one reason for this is that they have comprehensive international operations. at the same time, there are few effective international agreements on how to manage cross - border banking groups in a crisis situation. consequently, the failure of a major swedish bank would risk being difficult to manage. this also means that the cost for sweden ’ s taxpayers would risk being significant. the market assumes that major swedish banks have implicit state guarantees the market also assumes that the major banks have an implicit guarantee from the state, as they are considered to be too big for the state to allow them to fail. this means that these banks can obtain cheaper funding than would otherwise have been the case. the implied state guarantees were clearly illustrated by our neighbour, denmark, when amagerbanken collapsed and the danish authorities forced senior lenders to contribute. the result of this was that the credit rating agency moody