good understanding of how current trends affect banks. the first trend is digitalisation and the new competitive landscape. higher market shares of non - bank financial intermediaries put pressure on banks'margins. this can create incentives to take excessive risks. digitalisation changes the provision of financial services. banks can benefit – but they also face higher risks. the ssm is responding. it is making digitalisation a priority and is preparing for a cyber resilience stress test. the second trend is higher risks – geopolitical, macroeconomic, climate - related and environmental. these new risks affect banks – but our surveys show insufficient integration into banks'risk management. this means : strong supervision must ensure that banks are well governed and have sufficient capital and liquidity buffers. if we identify weaknesses, we need to use our supervisory tools in a timely and effective manner. i am committed to a structured evaluation of these tools. the ssm's digital agenda supports this – digital tools reduce time spent on routine tasks and provide useful information. external assessments also concluded that the supervisory review and evaluation process is too long and too complex. as chair, i will work to simplify and streamline this process – cooperating closely with the european banking authority ( eba ) and liaising with the european parliament. * * * closely related to this, my second priority is to make supervision even more proactive. just as good supervisors need excellent analytical skills, they need a sound judgement and a critical mindset. we need to ask the right questions, and we need to act swiftly. to achieve this, we can build on a culture in the ssm that promotes intrusive supervision. the new risk tolerance framework sets the focus on relevant risks. we need continuous training, and we can learn from best practices – because diversity is a great strength of the ssm. and, of course, the " tone from the top " matters : the supervisory board needs to continue to encourage a culture of trust and the escalation of critical findings. 2 / 3 bis - central bankers'speeches * * * my third priority would be to cooperate closely with all stakeholders. i am committed to a constructive and transparent dialogue, in particular with the parliament. we share the goal of completing the banking union. as chair, i would continue to work actively towards this joint goal – first and foremost by delivering on our mandate. i strongly welcome the agreement on the banking package and your ongoing work on anti - money laundering. further steps

andreas dombret : prospects for, and obstacles to, greater proportionality in regulation – a supervisor ’ s perspective speech by dr andreas dombret, member of the executive board of the deutsche bundesbank, at the second regional banking conference of the state of hesse, brussels, 21 february 2018. * * * 1. introduction ladies and gentlemen i would like to start by thanking you very much for the warm welcome and for inviting me to this event. when i was asked to speak to you here today about the prospects for, and obstacles to, greater proportionality in banking regulation, i jumped at the opportunity – and i did so because this is a topic that is especially close to my heart. let ’ s take a look back : when the debate first started in 2016, i sought to have the bundesbank review whether smaller credit institutions were unduly burdened by regulation. and once we were able to show clear signs of this, i decided that the bundesbank should be quick to turn the debate towards potential solutions. this is all the more important to us because we regard diversity as a key attribute, not only in nature and our society but also in our economy and the banking sector. after all, diversity is crucial to economic development, too – it means increased competition for the best approaches, more choice in decision - making, and greater innovation. today, i have been presented with the task of talking about regulatory proportionality from a supervisor ’ s perspective. as you have already heard what the credit institutions have to say, i need only give a rough overview of the reasons for greater proportionality and the burdens weighing on smaller institutions. instead, i will focus on the prospects for, and obstacles to, greater proportionality, before wrapping things up by outlining what greater proportionality in the eu might look like. 2. why do we need greater proportionality? the arguments in favour of greater proportionality are myriad – you have doubtless spoken about many of the reasons for it at this conference already. and, as far as banking supervisors are concerned, too, there are strong arguments as to why greater regulatory proportionality is needed. now that the financial crisis is over, we have stricter rules and a common european approach to supervision in the form of basel iii and the banking union. these rules are mainly geared towards large banks with international ties, which is not exactly surprising considering these banks were the ones at the epicentre of the crisis. in europe, however