should raise their loss - absorbing capacity, but rather what the most suitable way and the right time to do so are. faced with these foreseeable changes in the regulatory and supervisory framework, and irrespective of whether the ongoing assessment exercise is likely to be generally satisfactory, spanish banks must evidently seize every opportunity to strengthen their capital position as the improvement observed in financial conditions progressively firms, be this through gains in efficiency, retained profits or new securities issues. 5. conclusions to conclude, i believe the major structural changes sweeping the banking industry will have been reiterated in this conference. we should assume that in the future the banking sector will be better capitalised and safer. as a counterpoint, however, it will likely be smaller and, probably, less profitable. all these changes will have appreciable consequences for banks ’ business models and competitive strategies. the concurrence of this global process and the start - up of the banking union in europe poses, in the short term, additional and considerable logistic and strategic challenges. yet far from being a disadvantage, the banking union will over the medium term improve the european banking sector ’ s competitive capacity. banks will benefit not only from a genuinely unified market but also, more directly, from the added strength this project brings to the monetary union. and the soundness of banks and the stability of the financial system as a whole will hinge crucially on the proper functioning of this union. thank you. bis central bankers ’ speeches

aimed at repairing the balance sheet funding mix of each bank through a combination of agreed deleveraging transactions or asset disposals, and a set of liquidity metrics to be achieved by december 2013. four institutions, aib, boi, ebs and ilp, are currently executing the plar plans agreed with the central bank. under the plar we have set three key target funding ratios : a loan to deposit ratio ; a net stable funding ratio : and a liquidity coverage ratio. we are monitoring progress towards achieving all these three key targets. banks must submit a detailed point - in - time quarterly liquidity profile to us. we will examine funding ratios and compare them against the interim targets established as part of plar 2011. in addition, the central bank and other public authorities are interacting more regularly with banks to monitor progress towards the disposal of non - core assets. deleveraging at individual banks is a critical part of the necessary restructuring process. by the end of 2013 the core components of the banks will focus on supporting the irish economy. in the meantime, assets for disposal and deleveraging will be managed though non - core divisions. we have ensured that capital is set aside to support this deleveraging process. but there is common cause between the central bank, the government and the bis central bankers ’ speeches banks that deleveraging should not come at any price and that fire sales should not be adopted for the deleveraging process. we are therefore monitoring this process closely. this deleveraging process will be a long slog but it is now starting in earnest. it will require close monitoring and perseverance, with some difficult judgement calls around transaction prices. the banks themselves have the lead responsibility for ensuring progress with this process while responsibility for ensuring value for money lies with the bank ’ s principal shareholder, namely the government. it will be important that the non - core management teams and governance arrangements are put in place swiftly to ensure momentum with the deleveraging process. refreshing boards and management a third key work stream involves improving standards of governance and fitness and probity for the financial services sector generally, and continuing the process of refreshing the boards and management teams of the banks. we have learned from the banking crisis the importance of good corporate governance. as a result, we are working to develop effective corporate governance codes for the different financial services sectors. we have introduced a statutory code of corporate governance which sets out clear requirements that the directors and boards of banks and insurance