all collateral types. overall, banks recoup on average around 25 % of the excess liquidity charge in both secured and unsecured funding. it is worthwhile remembering that we set monetary policy to honour our mandate, not to support financial sector profitability. that being said, i do recognise that the longer unconventional measures remain in place, the greater the impact they will have on financial sector profitability. it is important that they are used only for as long as is necessary to achieve an inflation rate in line with our definition of medium - term price stability. moreover, as the bank for international settlement has recently found, there seems to be an independent role for nominal interest rates in the transmission process, regardless of the level of real rates. first, monetary policy transmission could be weakened by the headwinds that arise in the aftermath of balance sheet recessions. second, inherent non - linearities could kick in when interest rates are persistently low and might dampen the interest rates ’ impact on spending. but let us also not forget that profitability is weak in many european banking systems for deeper structural reasons that predate the crisis and current monetary policy settings. europe remains overbanked, insufficient progress has been made on the overhang of non - performing loans since the crisis and there is increasing competition from fintech companies and non - banks. in such an environment, what then can be done to bolster bank profitability? first, there remains significant scope for domestic consolidation in some large countries and cross - border consolidation in europe. the ratio of banking sector assets to gdp in europe far exceeds that in the united states or here in japan, and individual european banks are on average much more leveraged. overbanking results in lower margins, a higher risk of the loans granted eventually turning sour, and banks operating away from the efficiency frontier with a consequently higher cost to income margins. during the crisis we witnessed the fracturing of interbank markets along national lines, and the negative spill - overs between sovereign indebtedness and banking sectors in a number of countries. there are a number of benefits from a truly european banking system. a more consolidated sector is likely to help overall profitability and boost resilience. individual banks would be exposed to a more diversified set of risks, and less vulnerable to downturns in individual countries, helping to break the link between banks and sovereigns. at the same time, a europe - wide banking system is an important step towards completing economic and monetary

benoit cœure : welcome remarks welcome remarks by mr benoit cœure, member of the executive board of the european central bank, at the foreign exchange contact group meeting, frankfurt am main, 28 november 2018. * * * i am very pleased to welcome you here today to the foreign exchange contact group ( fxcg ) meeting. thank you for coming to frankfurt to share your views and insights with us. in my short introductory remarks, i would like to address the importance of strengthening the foundations of the foreign exchange ( fx ) market. i will argue that we all have a role to play here, and that adopting and adhering to the fx global code ( “ the code ” ) is a powerful way to support change and engage non - signatories in the change process. let me start by briefly illustrating a few of the most notable changes to the fx market structure in recent years. since our market contact group was set up in 1999, the fx market landscape has undergone a deep and broad structural evolution, which has gained significant momentum in recent years. on the sell side, one of the most notable changes relates to the execution of trades. fx trading has become increasingly electronic and automated, reflecting technological advances. the share of spot fx trading that is conducted electronically has almost doubled in the past ten years and now constitutes a substantial majority of daily turnover. the process of growing digitalisation coincided with the emergence of new market participants, trading venues and innovative services. despite these developments, however, liquidity provision has become more concentrated. today, fewer market participants account for an increasing share of fx turnover. we have observed similar changes in market structure on the buy side. for instance, over the past few years asset managers have generally increased their activities in fx - related products and have, over time, collectively emerged as important players in the fx industry. together, these structural evolutions have had implications for how the market functions and how central banks monitor the fx market. on the monitoring side, one tangible implication was the need to broaden the fxcg ’ s outreach to appropriately reflect the new, and more diverse, investor landscape. the ecb ’ s market contact groups are open to all interested market participants that apply for membership. it is important for us to follow a transparent application and governance framework. this is why the fxcg terms of reference, application forms and meeting material, such as agendas, the list of participants, presentations and summaries of our and other ecb market