to say with any certainty how the results will turn out. that ’ s why i find it downright illconsidered for third parties to suggest that they know the outcome. bearing this in mind, i trust you will appreciate that the bundesbank will refrain from making any further public statements on the comprehensive assessment as from mid - september. if the aqr or the stress test reveal any capital shortfalls, it will be up to the banks to cover them as quickly as they can, first and foremost by approaching their stakeholders for additional funding. no later than two weeks after publication of the results, institutions will be required to submit capital plans in which they explain in detail how they intend to cover any capital shortfall. however, let us not forget one thing. the comprehensive assessment is based on balance sheet data as at 31 december 2013. when considering the published results, it is therefore important to pay particular attention to the column listing the capital measures taken in 2014. we expressly welcome the fact that several banks have strengthened their capital base in recent months. this helps make the banking system more stable. if there are not enough private funds to fill any capital shortfalls identified, the state in question will be obliged to provide a “ backstop ”. as a last resort, the government is to recapitalise banks, issue guarantees or take on risks. however, this government support is subject to strict conditions. the bank must be solvent, and the support must not offset any accrued losses. moreover, government assistance may be granted only if it serves to avert disruption to the real economy or dangers to financial stability. the comprehensive assessment is a major organisational undertaking for all involved, and one which must, furthermore, be implemented under massive time pressure. at its peak, more than 1, 700 auditors and 230 bundesbank and bafin supervisors were involved in germany alone. moreover, my experience in the bundesbank is that, ultimately, far more colleagues are, of course, involved in the comprehensive assessment than just those officially assigned to the project. some are helping out temporarily or indirectly, while others have had to take on tasks originally performed by staff now directly involved with the comprehensive assessment. for banks, too, taking part in the assessment involves a lot of work. and yet, the comprehensive assessment is decisive if the single supervisory mechanism is to get off to a good start. bis central bankers ’ speeches 3. the world post 4 november under the single supervisory mechanism,

financial industry of the expected and well identified proposed changes. clearly, the practical adoption of the proposed changes should be driven by the goal for achieving a higher convergence with international standards, but it should be determined by the characteristics of the national or regional financial system, and their development goals. in addition, focusing only at better regulating the financial industry, without addressing other important and probably unsustainable economic developments, is an asymmetric approach that will not deal properly with the risks to financial stability. in this regard, governments, businesses and households, should identify measures and adopt actions to reduce imbalances in their own balance sheets, as this will, on the other side, improve the quality of the financial industry and reduce risk. dear participants, let me now focus more on how the albanian economy and our financial system was challenged by the international crisis, and what are some of the future measures the bank of albania believes are important to strengthen the stability of the financial system and of our economy. the recent international crisis showed that at the time of continuing financial integration and economic globalization, small economies like albania ’ s or other countries ’ in the region, should not count only on some natural protection coming from less developed financial markets and a much lower level of indebtedness from the households and businesses, to compensate over time for potential risks coming from less diversified economic growth, overreliance in remittances, insufficient culture of risk management in financial institutions and other economic agents – in particular for the exchange rate and liquidity risk, and very limited space from the public authorities to introduce anti - crisis financial measures similar to those in the developed countries. hence, policy measures should address these and other deficiencies to find a proper solution in the medium - term. such measures should reflect the preference for preventive approaches. in fact, over the last 4 to 5 years the bank of albania was vigilant over time to point out areas of the banking activity that required attention from the industry. we have expressed our concern regarding the rapid increase in lending, as we believed that this could negatively affect the credit quality. the composition of the loan portfolio, which is dominated by the euro - denominated loans, has also been identified as a point of concern. despite the fact that this position is supported by a strong presence of foreign currency denominated liabilities in banks balance sheets and very close economic links to euro - area countries like italy and greece, bank of albania has been consistent in its approach to introduce