recent bank failures will likely be an analysis of and recommendation for changes in supervision. how do we prioritize these issues for improving risk - based supervision? how do we revise those priorities when underlying economic conditions evolve or banks begin to engage in new activities that present new risks? we will need to be sure that whatever approach we adopt, we devote sufficient supervisory attention to the areas of highest risk, while not hindering innovation. as i ’ ve briefly discussed today, we need to have a supervisory system that focuses appropriate attention on the traditional risks that are inherent to the business of banking : credit, liquidity, concentration, and interest rate risk. historically, supervision has been an effective tool to address these traditional risks. supervisors can make sure that banks are working to mitigate such risks with effective risk management and liquidity planning. as we consider changes to our framework, we need to understand potential unintended consequences and be mindful that we do not inhibit innovation so that banks remain competitive and well positioned to effectively serve the needs of their customers. - 7it will continue to be a challenge to ensure the appropriate focus on traditional banking risks while encouraging innovation. but it can be accomplished if we approach it from the need for transparency, transparency by banks about their innovation activities and agenda, and transparency by regulators regarding supervisory expectations and emerging risks. transparency can help us promote these dual objectives, maintaining a focus on traditional risks, while enabling banks to innovate in a safe and sound manner, with a clear understanding of our expectations. at the same time, failure to adopt a transparent approach can lead to adverse consequences for consumers, businesses, and communities by limiting banking products and services and pushing activities outside of the regulated banking system. we need to preserve regulatory support for innovation conducted safely and soundly consistent with applicable laws, including consumer protection. promoting bank readiness voices calling for broad, fundamental reforms of the u. s. banking system appear to advocate a shift away from tailoring and risk - based supervision. the view that we extend the reach of overly complex and outsized regulatory requirements to banks that are smaller and less complex ignores some likely results — doing so will lead to bank consolidation, and will potentially push banking activities outside of the regulated banking system. this could also lead to the elimination of all but the largest too - big - to - fail banks who would then be insulated from other competition. this is surely not the outcome that supporters of the 2008 financials crisis reforms were seeking. it is also

activities will continue through implementing the european regulatory framework applicable to the credit institutions with a focus on the consistent implementation of the technical standards and regulations, the guidelines of the european banking authority and the recommendations of the european systemic risk board. priorities : • carrying on the practice of uninterrupted supervisory cycle by means of ongoing off - site control 1 / 2 bis central bankers'speeches and on - site inspections ; • the supervisory review and assessment of banks based on the approach developed in alignment with the ecb internal guidelines and the guidelines issues by the european banking authority. the purpose of the supervisory review and assessment is to strengthen the link between the dynamics of risks within the system, a bank ’ s risk profile, its own funds, its liquid assets and risk management systems and internal control environment, which would serve as the basis for reaching an overall assessment of the viability of each credit institution individually ; • continuing the policy of conservative macro - prudential supervision aiming at accumulation and maintenance of capital buffers during the economic upturn. the objective is upholding the stability of the banking system, including by preventing or reducing the systemic risks involved in the activities of credit institutions and identifying and limiting the emergence of macroeconomic factors that would threaten the stability of the banking system. 2 / 2 bis central bankers'speeches