every national specificity – in these few selected areas, national authorities need to fil these gaps, and adjust the standards accordingly. another legitimate, but limited deviation concerns the reduction of administrative burdens for smaller institutions – like they are currently pursued in the us and the eu. further, if a non - eu bank has substantial activities in the eu, it should have a consolidated subsidiary that is supervised in that jurisdiction. an internationally active bank cannot have core capacities of risk management, capital and liquidity only in one spot. we have seen that the intermediate holding corporation laws in the us work quite well ; and the same will be true of the forthcoming eu equivalent, the intermediate parent undertaking regulation. the subsidiarisation requirement will also enhance the systemic stability of the financial ties between the uk and the eu after brexit. generally speaking, it is also a useful backstop against a regulatory race to the bottom, as it will make it difficult to provide cross - border services from less well - regulated locations. so i do understand that in light of brexit and the end of london ’ s direct access to the eu single market fears of regulatory fragmentation are worsening and leading to more calls to maintain a global level playing field. that ’ s why the important achievements of non - discrimination against foreign firms on the one hand and the g 20 ’ s minimum standards should be upheld. however, our approach to international cooperation is to make sure that every supervisor can oversee the entities active in its jurisdiction. 2 / 4 bis central bankers'speeches 5 conclusion ladies and gentlemen, simple answers to complex problems are comforting, but they divert our attention from the real issues. the concept of splendid isolation is a myth ; it solves no problems. if the transatlantic partnership and close multilateral cooperation are to be resilient cornerstones of the world economy, we need rational, careful decision - making, policy case by policy case ; where some cases will be better dealt with in the national realm, while others will turn out to require coordinated or even cooperative approaches. the bundesbank has a reputation as being principles - oriented – sometimes maybe even too much so. we will continue to seek our us partners ’ advice and work towards mutually beneficial solutions, where cooperation is rational and viable. our new york representative office plays an important role in those efforts, and to end my remarks, i want to introduce four persons who play important roles in furthering cooperation. let me start with the executive board member inter alia

are only now beginning to realise how dependent their economy has been and still is on eu membership. many problems became only obvious during the exit negotiations – most of which were never an issue during the leave campaign. i think that compartmentalisation helping the national economy is a dangerous illusion which does not provide substantial solutions to serious challenges. there has never been such a mythological nation - state, and it certainly doesn ’ t exist in the era of the internet, smartphones and mass air travel. what then is sovereignty in the 21st century? it is the capacity to decide rationally about where cooperation is, on balance, better than going it alone, even if it entails unpleasant compromises. 1 / 4 bis central bankers'speeches 3 the rationale for international cooperation in financial regulation following that, it seems reasonable to approach many areas of the economy in an internationally cooperative, rules - based manner. financial regulation, in my opinion, continues to be one area conducive to this approach, as we want to prevent a regulatory race to the bottom and to ensure fair competition, i. e. a level playing field. it was in that spirit that the g 20, led by the united states, spearheaded the efforts to tackle the financial crisis. the g 20 efforts have created a rational, viable approach to international cooperation that is in the interest of all member states – its principles should therefore remain pillars of the regulation of international finance. it is built on close transatlantic and international cooperation between our central banks and our regulators and supervisors. it also rests on the joint work in international regulatory fora to foster our mutual understanding and the common language we have developed over the past thirty years. this approach also builds on a whole body of international minimum standards, like the basel iii regime for internationally active banks that we have developed over the last ten years. the basel iii standards have proven to be a success story, as they are the foundation for banking regulation in more than 100 countries. 4 the illusion of the global level playing field ladies and gentlemen, as we strive to prevent a race to the bottom and maintain a fair, level playing field, i am convinced that international, rules - based cooperation is – and should remain – the method of choice not only, but in particular in the area of financial regulation. at the same time, i am less convinced that basel iii is a “ one size fits all ” approach and that adherence to international standards makes national supervision redundant. basel standards are minimum standards that cannot cover each and