prevented by inclusion in the bank act 1998 of exceptions to general dutch law which are specifically based on the treaty. nonetheless, some provisions in the dutch civil code might still conflict with the treaty or the statute of the european system of central banks. the bank act 1998 hence contains the provision that where this occurs, the provisions of the dutch civil code shall not apply to the bank. public body the third approach to the legal regimes applying to the bank relates to the fact that the bank holds public authority. pursuant to the bank act, the bank exercises public - law powers and is consequently a public body in terms of the general administrative law act. as emerges from the bank act, the bank, in exercising its powers, is not hierarchically subordinate to the minister of finance and is hence an independent public body which performs its public tasks at a remove from the minister. the minister need thus be less concerned with details and can concentrate more on the main thrust of policies. however, the minister remains accountable to parliament for the relevant policy areas. he must provide the required conditions, such as sound legislation and an adequate set of instruments to allow a public body to operate efficiently and effectively. as the minister should also monitor the quality of the public body ’ s performance, he needs the requisite instruments such the right to ( aggregated ) information, budget approval, receipt of an annual report and annual accounts, the right to appoint and dismiss directors and members of the supervisory organs and to intervene if the public body is neglecting its task. the minister ’ s instruments must, however, be geared to the specific nature of the relevant public body. this applies particularly to the bank which, for various reasons, is an exceptional public body. first and foremost because the bank ’ s status as public body only covers its dutch powers under public law and not those powers which it exercises on the basis of european community law, namely its system tasks. and secondly because the treaty requires that the bank, as part of the system, shall function completely independently from political influence. this raises the question whether the minister has enough scope to exercise his responsibility for the bank ’ s non - system tasks, including the supervision of financial institutions. the answer is yes, provided that the instruments available to the minister are carefully selected. moreover, the bank is an exceptional public body because of the concept ‘ supervision at a distance ’, meaning that for supervisors of financial institutions, the distance from political influence is an essential point of departure for the independent and expert exercise of

a level playing field. on evaluating the effectiveness and efficiency of macro - prudential tools, i believe the main challenge is to ensure that the regulatory framework remains sufficiently capable of addressing systemic risks. especially in an ever - changing financial sector. this is why we should keep an open mind to developing the framework further. against that background, allow me to highlight some lessons from the last couple of years. first, it is equally important to understand what macro - prudential policy can and cannot do. the current macro - prudential toolkit, at least in the netherlands, is mainly geared toward building bank buffers and resilience. however, the macro - prudential authority 1 / 4 bis - central bankers'speeches should ideally also have sufficient tools at its disposal to limit the cyclical build - up of excessive risks at a much earlier stage. i am thinking here, for example, of borrowerbased measures. of course, that theme interacts with political economy deliberations, a reason why i will not dwell on that any further here. second, the covid pandemic showed us the great value of having sufficient capital buffers that can be released. this capital should supplement a sufficiently large layer of structural buffers, and can be used in response to a shock. thereby giving banks extra room to absorb losses and keep credit flowing. against this background, in the netherlands we decided to revise our framework to target a 2 % countercyclical capital buffer in an environment in which risks are neither subdued nor elevated, known elsewhere as a'positive neutral rate '. this brings me to my third lesson, which is that there is great merit in building buffers early on. after all, by building capital in times when risks are slowly on the rise, when financial conditions are favourable, and when bank profitability is there, we are able to prepare the sector for worse times and avoid difficult situations later on, such as the one in which regulators may want to increase capital requirements but fear the procyclical effects this could bring about. in the same vein, there is merit in taking better account of both the benefits and costs of capital requirements when determining the right policy mix. this consideration is also relevant at this juncture, where profits in the european banking sector are looking rather healthy still, while uncertainty about the future macro - financial environment is on the rise. it is clear that we have come a long way. at the same time, i am