ecb of significant banks. the ecb plans to devote two directorate generals to this direct supervision of significant banks, dgs i and ii. additionally, a dg iii will be created to deal with the indirect supervision of the less significant institutions. finally, a dg iv will carry out horizontal functions such as supervisory quality assurance, methodology and standards, enforcement and models approval. overall, including the secretariat, the ecb will need around 1, 000 new staff, 750 of them directly involved in supervision. as said before, each joint team will be responsible for the overall supervisory activity in respect of a credit institution. to conduct such supervision, the jst will first determine the risk profile of the bank. in this regard, it is of paramount importance to have a common assessment system that guarantees consistent valuation across the population of banks and the different jurisdictions. to that end, part of the effort in the preparatory work is being devoted to designing a “ risk assessment system ” anchored in objective data and ratios. some final remarks on key issues let me conclude with some comments on the comprehensive assessment of all banks that will come under direct ecb supervision. this will consist of three elements : a supervisory risk assessment, a balance sheet assessment and a stress test, and shall be concluded before the ecb assumes its supervisory functions in a year from now. the supervisory risk assessment will incorporate supervisory judgment on all risk factors, aiming to evaluate measures and summarise in a comparable form across banks all potential sources of risk. this risk assessment will also be used for the portfolio selection to be undertaken as part of the balance sheet assessment. the second element, the balance sheet assessment, will be carried out at a given point in time and on an accounting basis. this assessment will be broad and inclusive, covering credit and market exposures, on and off - balance sheet positions, domestic and significant non - domestic exposures. one key issue is going to be the capital threshold used for this exercise, which, in accordance with the definitions of the capital requirements regulation and capital requirement directive iv, based on basel iii recommendations, will take into account the need for a demanding threshold. the main content and details of this exercise will be made public in the next few days. the third element, the stress test, will review the major risks of banking groups under various scenarios, testing the sensitivity of bank balance sheets to hypothetical external shocks. the features of the stress test will be defined in conjunction with the eba, and publicly disclosed at

report this morning. i would like to present the main points to you now. i will start with the domestically focused banks before moving on to the globally active banks and, in particular, the crisis at credit suisse. domestically focused banks for the domestically focused banks, the operating environment has changed markedly over the past year. interest rates have risen significantly and there are signs of a slowdown in the real estate market. overall, the domestically focused banks have benefited until now from the rise in interest rates. this rise has helped to restore their interest rate margins. the banks have been able to increase their profits and strengthen their capital buffers. at current interest rate levels, domestically focused banks ’ profitability is likely to continue to improve. an unexpected upward interest rate shock in the future, however, would likely have a negative impact on these banks. first, in this scenario their interest expenses would increase faster than their interest income. this is because interest rates on many outstanding loans are fixed for several years. by contrast, rates on deposits are likely to react faster to a further interest rate rise. second, higher interest rates could lead to credit losses in mortgage lending. this constitutes a significant risk for domestically focused banks because mortgages are often their main line of business. against this backdrop, the results of our stress tests are crucial : thanks to their capital buffers, most banks should be able to cope with such a scenario. page 4 / 8 zurich, 22 june 2023 thomas jordan, martin schlegel and andrea m. maechler news conference globally active banks – observations on the crisis at credit suisse as far as the globally active swiss banks are concerned, this year ’ s financial stability report focuses on the crisis at credit suisse and its acquisition by ubs. the snb supported this acquisition, in particular, through the provision of ample liquidity assistance. in addition to its existing liquidity facilities, the snb deployed two new instruments based on emergency law : ela + and the public liquidity backstop ( plb ). comprehensive lessons need to be drawn from the crisis at credit suisse. the goal must be to continue to strengthen banks ’ resilience in order to prevent, wherever possible, a loss of confidence such as that seen in the case of credit suisse. if a crisis does still occur, a broad range of effective options must be available. from the snb ’ s perspective, three observations are especially important here. first, compliance with capital requirements does