resilient. the capital shortfall of almost €13 billion identified at five german institutions has been made good, and overall the 12 banks involved met the stringent requirement for a core tier 1 capital ratio of at least 9 % on schedule – in fact, they exceeded the requirement by €15. 5 billion. in the past year, the institutions have reduced their claims on debtors in the euro - area periphery countries ; their exposure to greek debt is now negligible. however, german banks still have significant claims on the spanish and italian governments, amounting to €21 billion and €38 billion respectively. their exposure to spanish and italian banks totals around €36 billion and €44 billion respectively. this means that susceptibility to an escalation in the european sovereign debt crisis remains a high risk for the german banking sector. the german institutions have also rendered their balance sheets less vulnerable by scaling down known toxic assets. in the past two years, the 12 large german institutions have cut back their exposure to these asset - backed securities by 30 % to around €116 billion. however, the securities still present a latent risk if their rating structure should deteriorate. if the banks are to build further on the stabilisation they have already achieved, then an adequate earnings situation is of central importance. after the huge collapse in income suffered at the beginning of the crisis, the earnings situation of the 12 large complex financial institutions has recovered in more recent years and has now stabilised at a moderate level. earnings performance at the current end is somewhat modest. earnings for the large complex financial institutions in the first half of this year – a strong half traditionally – were down on the first six months of last year. interest income as well as fee and commission income – major contributors to profit – have so far been lacklustre. volatile trading income in the first six months also came in below the previous year ’ s level. in addition, risk provisioning, which was previously providing support for overall net income, has risen slightly of late. the figures we have so far for the third quarter of 2012 show a continuation of these trends ; overall, however, the results are likely to be an improvement on those for the disappointing third quarter of 2011. thus, the german banking sector has gone a fair way towards recovering from the effects of the financial crisis. however, a glance at the reform agenda shows that over the coming years the pressure on institutions to adapt will not abate. b )

william c dudley : the us monetary policy outlook and its global implications remarks by mr william c dudley, president and chief executive officer of the federal reserve bank of new york, at the bloomberg americas monetary summit, new york city, 20 april 2015. * * * matthew higgins, richard peach, paolo pesenti and joseph tracy assisted in preparing these remarks. it is a pleasure to have the opportunity to speak with you here today. in my remarks, i will assess the outlook for the u. s. economy and the progress that the federal reserve has made toward its dual mandate objectives of maximum employment in the context of price stability. over the past few years, the u. s. economy has made considerable progress toward achieving these goals. yet we still have further to go – the unemployment rate is still too high and the inflation rate too low. because the economic outlook is uncertain, i can ’ t tell you when normalization will occur. the timing is data dependent. we will have to see what unfolds. whenever such a shift in policy occurs, we need to be mindful that it most likely will be accompanied by some degree of market stress and turbulence. moreover, the normalization of u. s. monetary policy could create significant challenges for those emerging market economies ( emes ) that have been the recipients of large capital inflows in recent years. this leads to an important question : what can the federal reserve do to address these risks? while tightening cycles by the fed can pose challenges for emes, these need not be disruptive. the combination of stronger u. s. growth, improved eme fundamentals and effective fed communications can limit the stresses caused by the onset of tightening. the experience will vary across emes, but emes as a group are better equipped today to handle the challenge than they were in the past. as always, what i have to say today reflects my own views and not necessarily those of the federal open market committee ( fomc ) or the federal reserve system. the u. s. economic outlook since the end of the great recession more than five years ago, the u. s. economy has grown at a disappointing 2. 3 percent annualized rate. several times over that period, it appeared that growth was strengthening, but each time such hopes were subsequently unfulfilled. we appear again to be at a similar junction. real gdp growth accelerated over the last two years, rising at a 2. 7 percent annual rate. however