the recovery and resolution of credit institutions and investment firms. the part involving the bnb was finalised at the end of last year and is due for submission to the national assembly with legal amendments likely to get adopted by the end of this quarter. the bnb governor also outlined the second work block in this direction, on which the bnb is currently working, i. e., the overall framework of determining the amount of funds to be contributed by banks to the single resolution fund and the amount and way of transferring funds from the bank resolution fund in bulgaria, which was set up in 2015, to the single resolution fund. the third work block covers the overall activity of planning and conducting resolution activities, including the distribution of responsibilities and tasks between the single resolution board and the bnb after our country joins the banking union. with regard to the expected effects on the economy and the business, the bnb governor highlighted that it was positive to reaffirm bulgaria ’ s strategic course, and that the process is already being filled with content and specific timeframe. the whole process stands as a positive counterbalance against the more general uncertainty from the global and european economic environment. 1 / 2 bis central bankers'speeches among the more direct positive effects from this first stage on the path to the euro area is the anticipated improvement of the country ’ s credit rating, as announced by the credit agencies, should the process run successfully in the short - term. that would improve the funding conditions in the country. at the same time, the effects of joining erm ii will not be tangible in regard to the macroeconomic policy and neither will our monetary regime change. the bnb governor made it clear that the only exit from the current regime would be the replacement of the lev with the euro at the currently fixed exchange rate. the whole process of accession – first to the banking union and erm ii, and next to the euro area – could not substitute for the good macroeconomic practices and business projects, mr. radev said. a country refusing to comply with this is sure to suffer serious economic and financial difficulties whether inside or outside the euro area. the two proven pillars of good macroeconomic policy in bulgaria are the fiscal stability and the monetary regime stability. should these conditions, together with the continuous improvement of institutions, be present, the preparatory process and subsequently the accession to the euro area would be a catalyst for the social and economic prosperity of our country. 2 / 2 bis central bankers'speeches

in new markets and asset classes. in the past the analysis on these issues would have typically concentrated on the return aspects and portfolio management considerations, with only limited space for risk - related considerations in the exposition, the latter usually consisting of some simple references to the tracking error of certain assets against the benchmark portfolios. nowadays, even presentations firmly oriented on return - maximising investment decisions dedicate more time to look at the absolute risks of trading strategies and assets, and this is particularly true for credit and liquidity risks. bis central bankers ’ speeches indeed, during the current crisis we have learned the hard way that those “ forgotten ” risks, which were perceived as not deserving a single slide in many presentations of the past, matter more than we previously thought. for those holding responsibilities in the design and implementation of public policies, to observe the increasing recognition among market participants of the importance of strengthening risk management practices constitutes one of its very few positive consequences. causes and dynamics of the crisis some of the main lessons from the crisis seem obvious in hindsight, but unfortunately were not seen as such before the outburst of the financial turmoil in 2007 and 2008. in particular, there are clear indications that the way we look now at the trade - off between risks and returns has significantly changed over the past thee years and a half. however, the key question is whether the shift in attitude towards risk has changed only as a consequence of the materialisation of some “ forgotten ” risks or whether there is a deeper and more structural explanation for this shift. my view is that the reason why academics, market participants and public authorities devote more time and resources to identifying and assessing risk - related issues is not only the severity of the crisis and the uncertainty currently surrounding our economic and financial systems, but more fundamentally the fact that not only the roots, but also the trunk and branches of the crisis are closely related to risk management and governance aspects. in this regard, a number of thoughtful explanations of the causes and dynamics of the financial and economic crisis have been put forward. there is no doubt that risk managers can extract valid lessons from all of them, since there may be indeed some truth to all. indeed, there is probably no single argument that can alone explain everything that has happened over the past few years and we also must remain objective enough to separate ideology from facts, when assessing the different versions of the history that have or may become best - sellers. some of the possible causes and elements characterising the nature and evolution of the crisis