group and its foreign exchange subcommittee, we have endorsed and adopted the global code. this endorsement of the global foreign exchange code implies that we are now committed to evolving our own institutions ’ foreign exchange practices to be consistent with the principles outlined in the code. this will include a review of the structure of our local foreign exchange committee over the next few months. we believe that this code is a big step in the right direction and will contribute to strengthening standards in foreign exchange markets around the globe. the global code contains principles of good practice that provide a common set of guidelines to the market, with the intention of promoting the integrity and effective functioning of the relevant financial markets without imposing legal or regulatory obligations on market participants ; the code is not a substitute for regulation. having endorsed the global code, the sarb will strive to adhere to it in its own market operations and, over time, we would also expect counterparties that we transact with in the foreign exchange market to confirm their commitment and adherence to the global code for them to continue to be eligible counterparties. conclusion i would like to conclude by saying that we are still some distance away from the finish line when it comes to inculcating the highest standards of conduct and market best practice. and it is not the job of the regulators alone to cross that line ; it is the job of the financial sector as a whole. we recognise the contributions that each of you makes towards strengthening the standards of market practice. in continuing to do so, i would like to appeal to you to take very seriously the challenge of aligning your current culture to the desired culture. there is definitely the need for a fundamental shift in the mind - set of the financial services industry on the issue of culture ; more regulation is not necessarily the best way to go about fixing problematic conduct. page 7 of 8 i am pleased to note that, following the launch of the global code last week, aci worldwide has announced that it has developed a new aci global foreign exchange code certificate aligned to the principles and practices of the new code. this initiative is certainly a step in the right direction to promote the integrity and effectiveness of the foreign exchange market. let me use this opportunity to ask for your cooperation with our current review of the standards and practices in the domestic wholesale financial markets. the committee that has been appointed to carry out this review will soon be on your doorsteps, seeking to engage with you on various aspects relating to the structure of the financial markets. together we can make it

sector, while three credit institutions would see their solvency ratio fall below the minimum regulated threshold. the solvency ratio across the banking sector would diminish from 17. 1 % to 14. 6 %. • credit conversion at a monthly average rate ( from the credit agreement date to present ) would generate losses worth around lei 3. 2 billion for the entire banking sector, while two credit institutions would see their solvency ratio fall below the minimum regulated threshold. the solvency ratio across the banking sector would diminish from 17. 1 % to 15. 3 %. c. conversion of chf - and eur - denominated loans into lei at exchange rates other than the market exchange rate applicable on the conversion date. • assuming the cumulated conversion of chf - and eur - denominated loans at the historical rates in the month of extending the credit, banks would incur losses ( calculated as the difference between historical rates and the exchange rates on 23 january 2015, when the chf / ron was 4. 58 and the eur / ron was 4. 49 ) estimated at lei 9. 8 billion. the solvency ratio across the banking sector would diminish from 17. 1 % to 11. 7 %. four credit institutions would see their solvency ratio fall below the minimum regulated threshold and would require recapitalisation. • cumulated credit conversion at the historical rates + 20 % would generate losses worth around lei 5. 5 billion for the entire banking sector. the solvency ratio across the banking sector would diminish from 17. 1 % to 14. 1 %. four credit institutions would see their solvency ratio fall below the minimum regulated threshold and would require additional capital injections. • cumulated credit conversion at monthly average rates would generate losses worth around lei 4. 5 billion for the entire banking sector. the solvency ratio across the banking sector would diminish from 17. 1 % to 14. 6 %. vi. 2. realistic solutions the nbr advocates the implementation of customised solutions, negotiated between the parties directly involved in the credit agreement ( i. e. the credit institution and the borrower ). the solutions take into account the specifics of chf - denominated loans, in particular, and fx loans in general on the romanian market and combine : ( i ) free market principles, ( ii ) state support for vulnerable household groups, and ( iii ) the carrying out by the nbr of its legal