burkhard balz : closing remarks - " strengthening the national bank of belarus " closing remarks by mr burkhard balz, member of the executive board of the deutsche bundesbank, at the eu twinning project " strengthening the national bank of belarus ", minsk, 10 july 2019. * * * 1 introduction mr kalechits, mr samecki, ms kuniyoshi, ms wiktorin, your excellencies, distinguished guests, ladies and gentleman, first of all, i would like to thank you for the warm welcome and your kind introductory remarks. i ’ m delighted to be here in minsk today to celebrate with you all the successful conclusion of the eu twinning project with the national bank of the republic of belarus, narodowy bank polski, lietuvos bankas and the deutsche bundesbank. just a few days ago, our countries were still engaged in sporting rivalry as part of the 2nd european games here in minsk. the city was abuzz with more than 4, 000 athletes from 50 nations, and when i look around me, there are still lingering reminders of this event. what we are celebrating today, though, has attracted slightly less public attention, even though it is certainly no less significant. it is something that our central banks – representing our four countries – have achieved together : the first eu twinning project for belarus and the first eu twinning project for the national bank of the republic of belarus. it ’ s something that all the stakeholders can be proud of. and that ’ s why i ’ d like to take this opportunity to thank everyone involved for all their dedication and hard work. 2 the role and task of central banks ladies and gentlemen, on 14 may, the european union marked the 10th anniversary of the eastern partnership in brussels together with the six eastern partnership countries, including belarus. jean - claude juncker, president of the european commission, used this high - level conference to emphasise that the eastern partnership is fundamentally a future - oriented partnership for the citizens and with the citizens. he said : “ together we are working towards stronger economies, stronger governance, stronger connectivity and stronger societies. ” while our eu twinning project is just one building block in this broadly based cooperation process, no one should overlook the fact that central banks in particular are important government institutions. after all, they ensure that monetary systems continue functioning both at a national and an international level. economic systems based on the division of labour need stable money to

. before doing so, it is important to underscore what is at stake here. for all the disagreements among legislators, policy officials, and the public over the right set of financial reform measures, i have noted one point on which there is near unanimity : no one wants another tarp program. not those who thought tarp was the best of a bad set of options in the fall of 2008. certainly not those who opposed it. not the american people, many of whom saw the injection of billions of dollars of government capital into financial firms as more a bail - out of large banks than an imperative to stabilize the financial system. and not even, i suspect, most of the large financial firms that received the government capital. in a period of financial stress, the disorderly failure of one or more sifis carries the potential for a devastating impact on the financial system. the fear elicited by that prospect led the see daniel k. tarullo, regulating systemic risk ( 2011 ), “ regulating systemic risk, ” remarks delivered at the 2011 credit markets symposium, charlotte, north carolina, march ; daniel k. tarullo ( 2010 ), “ comments on ‘ regulating the shadow banking system, ’ ” remarks delivered at the brookings panel on economic activity, washington, september. bis central bankers ’ speeches bush administration to ask for tarp authority. that same fear led many members of congress with no great love for large financial firms to vote for tarp. those actions are further evidence for the proposition that, no matter what their general economic policy principles, government officials faced with a cascading financial crisis that threatens to bring down the national economy will usually support measures to rescue large banks. in order to avoid the need for a new tarp at some future moment of financial stress, the regulatory system must address now the risk of disorderly failure of sifis. rationale for enhanced capital requirements last fall central bank governors and heads of supervision from countries represented on the basel committee on banking supervision agreed to the important package of reforms in capital regulation known as basel iii. the basel iii requirements for better quality of capital, improved risk weightings, higher minimum capital ratios, and a capital conservation buffer comprise a key component of the post - crisis reform agenda. but they are just that – a component. although a few features of basel iii reflect macroprudential concerns, in the main it was a microprudential exercise. the new minimum equity capital ratio and conservation