october 2008 and april 2009. the governing council will continue to do what is necessary to preserve price stability and ensure the firm anchoring of inflation expectations over medium to longer - term horizons. such anchoring is indispensable to supporting sustainable growth and employment and also contributes to financial stability. let me also stress that, from the onset of the financial market tensions, the ecb has taken forceful action in its liquidity management, also through non - conventional measures, to make sure that banks are able to refinance themselves. our policy - making has been in a “ nonstandard mode ” for a considerable period of time. in october last year, we adopted a fixed rate tender procedure with full allotment for all main refinancing operations and longer - term refinancing operations with maturities of up to six months. in addition, the ecb expanded its list of assets eligible for use as collateral in eurosystem credit operations. as a result, the size of the eurosystem balance sheet has increased substantially during the financial turmoil, by around €600 billion between june 2007 and march 2009, mainly reflecting the expansion of liquidity provision to the banking system since last autumn. this is of particular significance for the euro area because the banking system plays a more important role in the financing of the private sector than in other major economies. at the same time, owing to the ecb ’ s liquidity management, overnight money market rates have fallen even more steeply than the key ecb interest rates since last october. money market rates in the euro area are now very low, also in an international comparison. overall, the provision and management of liquidity by the ecb have played a crucial role in the implementation of the ecb ’ s monetary policy. they have ensured that banks have adequate access to central bank funding so as to continue financing the economy and that liquidity constraints and perceived risks have not triggered a systemic crisis. the ecb will continue to foster the orderly functioning of money markets and the intermediation of funds by the banking system by taking appropriate measures, be they standard or non - standard. at the same time, the medium - term orientation of our monetary policy provides a clear and unambiguous signpost that will allow us to pursue a credible exit strategy from the current conditions of very low interest rates and extraordinary short - term liquidity support as the economic situation normalises. fiscal policies the economic downturn, discretionary fiscal measures to

action. the days when risk warnings were issued and very few listened – or wanted to listen – should be over! third, for the systemic risk council to be effective, legitimate and independent in its decision - making, a solid legal basis is essential. such a basis will also provide legal clarity regarding the necessary access to euwide macro - prudential information as well as to supervisory data concerning individual institutions, subject to adequate confidentiality arrangements. the next steps towards the implementation of the de larosiere group proposals will require a number of legal, institutional and organisational issues to be addressed. in this regard, the ecb stands ready to contribute to the necessary preparations in a constructive and timely manner. we look forward to the communication from the european commission and the decision of the european council in june that will lay the foundations of a new system of macro - prudential supervision in the eu. speedy progress towards that goal is of the essence, for the strengthening of macro - prudential supervision in europe is an important and urgent policy objective – and one which the members of this committee have strongly supported in a consistent and, indeed, visionary manner. * * * madam chair, honourable members of the committee, i would like to thank you on behalf of the executive board and the governing council for our enriching exchanges of views over the past five years. owing to the forthcoming elections to the european parliament, today ’ s presentation of our annual report is the last before your committee in its current composition. i have always appreciated your cooperation and our fruitful dialogue. thank you for your attention. i am now at your disposal for questions.