fall in non - performing loans, which would have been unthinkable if we had kept rates higher. it is certainly easy to blame the ecb, but the truth is that the level of the interest rates is not the main problem for many banks. the problems are, rather, the need for some business models to evolve in directions that strengthen banks ’ capacity to successfully face competition, as well as tougher regulation. also in spain, the squeeze on unit margins is not only due to low interest rates, but is also the result of competition. part of this may also be due to the fact that the banking sector in the euro area has not undergone sufficient consolidation. the new measures are improving liquidity conditions for the banking sector, but can they provide solutions to its capital needs? our measures have had a positive impact on banks ’ profitability and thus, indirectly, on their capital positions. for example, the relatively favourable lending conditions enable them to reduce their funding costs. as i said, the new tltros will reinforce these beneficial effects on banks ’ profits. more than in the past, when our long - term liquidity operations were positive mainly for banks ( including of course spanish banks ), the new tltros will benefit both banks and the real economy. bis central bankers ’ speeches do you think the new refinancing operations ( tltros ) will be welcomed by the banking sector? we believe that the new tltros will be even more favourable than the previous series and will be successful in helping to ease financing conditions. even if the banks don ’ t turn to us because they don ’ t want to be overly dependent on the ecb, knowing that they have this option will give them sufficient comfort to keep credit flowing to the economy on attractive terms. the ecb ’ s actions have also provoked criticism from political circles, particularly in germany. how far can the ecb go without political backing? it ’ s our belief that we have a lot of political support in europe. our policies are dictated by decades of monetary thinking and best central bank practices. the deutsche bundesbank has been the champion of this thinking and these practices. central bank independence and low and steady inflation are written into the german founding law. in my opinion, the alternatives proposed by those criticising us are not very credible. if we raised interest rates now, it would no doubt abort the recovery of the economy and compromise the achievement of our objective. and what ’ s your assessment

##p continues to strongly urge the timely implementation of these government interventions to mitigate the impact of persistent supply - side pressures on inflation. let me now move on to our second mandate, which is financial stability. 2 / 4 bis - central bankers'speeches banks continue to be a source of strength for our economy. they have adequate capital buffers, sufficient liquidity, minimal exposure to bad debts, and growing assets, deposits, and loans. a sound regulatory environment - the result of decades of reforms - supports the country's banking system. against this backdrop, the bsp is onboarding banks in the country's sustainable and financial inclusion agenda. we have put in place regulations that encourage banks to provide financing to green projects and incorporate sustainability principles in their operations. moving on to the third pillar of central banking - a safe and efficient payments and settlements system. in this space, financial digitalization plays an integral role as it helps facilitate the speed and efficiency of payments. in addition, financial digitalization helps accelerate financial inclusion. if there are more ways to access financial services - microloans, for example - more filipinos will be able to participate in economic activities, thereby uplifting their economic well - being. the bsp has set twin goals for next year under its digital payments transformation roadmap : first, at least half of the volume of financial transactions in the country should be done using digital platforms ; and second, at least 70. 0 percent of filipino adults should be financially included through a formal transaction account. i am glad to report that we are on track to achieve these twin goals. in 2021, 30. 0 percent of financial transactions were done through electronic channels, while 56. 0 percent of filipino adults already had formal transaction accounts. key messages in closing, let me leave you with these key messages : first, the bsp is committed to bringing inflation back to within the target range over the medium term. second, our banking system is solid, stable, and capable of supporting economic growth. lastly, we are keen on promoting a safe and efficient payments and settlements system through financial digitalization. the bsp remains one with ejap in promoting a high standard of economic news reporting, which we are celebrating through this event. we are keen to see your professional community achieve more and more success in shaping the minds and perceptions of a new breed of filipinos - one which makes intelligent financial decisions in their everyday lives. congratulations in advance to all nominees and winners tonight. 3 /