the arb, though emphasising the importance of competition, nevertheless tolerates misreporting, fraud and the violation of laws. the association neither condemns dubious operations nor seeks to develop good standards of practice. furthermore, they demand that we turn a blind eye to problems arising in banks. this is exactly what the arb means when it insists that we ‘ not revoke so many licences ’. however, we abide by the law and take measures stipulated by the law. managers of those banks from whom licences were revoked used to be members of the arb board, i. e. in the best case these people were not particularly gifted or responsible bankers, and as a result they triggered the collapse of their credit institutions. here we are faced with a question about which objectives and targets the association can deliver 1 / 4 bis central bankers'speeches on. should it set standards ( including ethical ones ) for the banking sector ; should it be the voice of the banking community in dialogue with the regulator or should it stand up for ‘ bad ’ banks? i would like to place special emphasis on the fact that when the bank of russia withdraws unstable or fraudulent credit institutions from the market, it first, protects the interests of depositors and creditors, and only thereafter is interested in protecting the interests of scrupulous banks. the clearing of the banking sector is yet to be completed, therefore corporate customers will not just choose from banks offering products and services they need, but seek to mitigate the risk of losing money. in particular, it also manifests itself in the authorities ’ efforts to determine specific criteria for banks, or a list of banks, which can be entrusted with budget funds and the funds of public companies. the arb raised the point that these criteria restrict competition. let me repeat, competition is undermined by fraudulent banks which remain on the market, while attempts to limit risk by means of registers and criteria are just a corollary. by and large, we would like to avoid a situation in which competition for the benefit of a customer in the form of the state or a public company, is undermined by such lists or unreasonable criteria. therefore we suggest a course of action wherein only limited supervisory information is disclosed to a potential customer, with the bank ’ s consent, if that customer is seeking to raise public funds. we believe that this approach may help to ensure a competitive environment for banks of different size. i am certain that banks convinced of their own stability will

europe, we must now complete the banking union. we must now resolutely work towards completing the european banking union. i would first like to explain why. the finalisation of the banking union should, alongside the capital markets union, contribute to improving private risk sharing within the euro area. private risk sharing fulfils an economic stabilisation function : in the united states, for example, private financial flows between the federal states are a more powerful damper than budget mechanisms involved in public risk sharing. furthermore, this private risk sharing should help to channel the euro area ’ s large savings surplus – eur 390 billion in 2017 – towards european companies, within a real financing union for investment and innovation at the european level. we have taken a step forward with the agreement of 25 may at the ecofin council meeting on the " banking reform package " set out in the commission's legislative proposal of 23 november 2016. even if we need to wait for the parliament's proposal and the outcome of the trialogue discussions, this agreement is overall positive. on the supervision side, it provides the european union with all the prudential ratios of the international framework. it also provides for the gradual introduction of the revised market risk framework, the fundamental review of the trading book ( frtb ), which is still being finalised in basel. in addition, a first step has been taken towards recognising the euro area as a single jurisdiction, in which cross - border exposures within the banking union are considered domestic exposures for measuring the systemic importance of european banks. on the resolution side, we have obtained an agreement to broaden the subordination requirement of the minimum requirement for own funds and eligible liabilities ( mrel ) to page 4 of 6 beyond global systemically important banks ( g - sibs ), thereby reducing the threshold effect between g - sibs and other banks. in addition, the text defines a subordinated debt ceiling, very close to the international total loss absorbing capacity ( tlac ) standard. however, this agreement contains a number of more problematic aspects about which we shall remain vigilant. to name but one, as regards the internal mrel, cross - border exemptions within the banking union similar to the methodology for calculating the capital surcharge for systemic banks would have been desirable. in addition, we are concerned about a reference to the threshold allowing access to the resolution fund being introduced into the calibration of the internal mr