the much lower number of problem banks, and the lower level of problem loans, in the recession that began early last year, compared to the previous one. for bank supervisors, the industry ’ s own growing emphasis on enhancing risk management practices has allowed us to shift our approach from evaluating financial results to understanding and assessing the quality of internal processes. by looking at the strength of internal controls and the quality of analysis and judgement that management applies, we are better able to understand how well a bank will weather potential future challenges or business downturns. in this context, one area that has come under increased scrutiny is how firms manage their compliance activities across the organization. firm - wide compliance management is an important element of good corporate governance and one that can reveal much about a bank ’ s culture and commitment to managing not only legal and reputational risk, but credit, market and operational risks as well. this shift in emphasis should be evident in the examination findings that the u. s. bankers in the room are receiving. we do not want our examiners to give you back your own numbers, or to limit their evaluation of your institution to where you stand in terms of some rigid regulatory parameters. such information should hardly be news to you. nor should it be the principal basis on which we assess your institution. rather, our dialogue with you should be focused on our evaluation of the rigor of your control processes, and particularly on our view of your risk management practices and systems relative to evolving industry standards. we have the tremendous advantage of breadth of access to firms engaging in a given business line, allowing us to develop a clear perspective on evolving best practices. at the new york fed, we have looked to maximize this advantage by setting up specialized teams to review specific business lines across the industry in order to develop that informed perspective. a key goal of our new organizational approach is to enable us to share with you our specific insights on best practices across a range of institutions. in the past year or so, i think we have made quite good progress in providing this peer perspective on risk management and controls. in such areas as corporate governance, economic capital estimation, and anti - money laundering, i think we have been able to be quite specific on how well a given banking organization measures up to evolving industry standards - including what needs to be done to move up to the top rung of performance. i also recognize that there is a tremendous demand for us to provide even more guidance in these dimensions. in the numerous feedback sessions

, and most importantly for us, central bankers, with the digital euro, we would strengthen the monetary sovereignty of the euro area, and preserve the effectiveness of monetary policy. * * * taken all together, the digitization of public money seems to be rather a necessity than merely an opportunity. at this point, readiness is key concept we are following. that is why today, the vast majority of central banks are considering their own digital currency. after the eurosystem has recently completed the investigation phase, we have just embarked on the preparation phase. therefore, we do not have all the answers yet, but we are keeping up to be prepared if or when the time comes for its introduction. to share with you the findings of work done so far, and also to address open issues, i have invited my fellow colleagues, governors from croatia, estonia, lithuania, malta and slovakia to share our knowledge and views on the digital euro. but before we move on to the panel discussion, let me give the floor to simon anko, director responsible for the digital euro project at banka slovenije to set the scene : what we have achieved so far and what are the dilemmas we are faced with. 2 / 2 bis - central bankers'speeches