with good access to short and long - term funding. however, the interbank market is still not functioning satisfactorily. we have now moved into a phase where the main challenge may be banks ’ financial strength. this is partly due to the downturn in the global and norwegian economies, which over time will result in higher losses, but also because higher capital adequacy is now being required in the markets. the same view has been expressed by the norwegian supervisory authority. we see that many banks abroad are raising new capital, with or without assistance from the authorities. but additional equity capital is now very expensive and perhaps also difficult to procure. the alternative for banks may be to hold back on lending. if they do this on a large scale, it will have considerable negative effects on output and employment. it is understandable that credit growth is now slowing, both because demand for credit is lower and because fewer investments are profitable. but in addition, it appears that banks are applying stricter criteria in credit assessments and rationing credit. norges bank ’ s survey of bank lending shows the banks ’ own perception of this practice. the chart shows that over the past year banks have reported a tightening of credit standards. it appears that credit flows to households have improved somewhat, but banks are still tightening credit standards for corporate loans. an important lesson to be learned from this economic crisis is that compelling banks to increase their equity capital when the downturn has already started has a considerably negative impact. it is important that banks have sufficient capital to make them resilient even if the downturn should persist over a longer period. for this reason, we have proposed government capital injections in banks. the government bond fund will buy bank and corporate bonds. in norges bank ’ s view, it is particularly important helps to improve demand for corporate bonds. the fund shall primarily buy high quality bonds. the chart shows that it is on the whole borrowers with weaker ratings that are now being excluded. norges bank is nevertheless of the view that higher demand for the best bonds will have a positive effect. this will reduce the pressure on banks, and it may result in a shift in private demand towards bonds with a lower credit rating. thank you for your attention.

luis de guindos : strengthening european financial markets to ensure a more resilient future keynote speech by mr luis de guindos, vice - president of the european central bank, at the joint conference of the european commission and the european central bank on european financial integration, frankfurt am main, 18 june 2024. * * * it is a pleasure to address you once again at this annual joint conference on european financial integration. over the years, this platform has become an important forum for discussing the pivotal issues shaping the financial landscape of the eu. the discussions and analysis we heard in today's sessions provide valuable perspectives on how we can foster financial integration. the conference is also very timely, coming just before a new european commission will have to shape the policy agenda for the coming years. financial integration and financial stability are key to ensuring a resilient and prosperous future for europe. developments in financial integration despite the resilience shown during the recent unprecedented times – marked by significant global geopolitical and economic shocks – progress towards greater financial integration in the euro area has been disappointing overall. over the past two years, price and quantity - based measures of financial integration have declined substantially. in fact, we are back to the levels seen at the start of the monetary union, and this is despite the significant legislative efforts made over the past decade. cross - border financial market activities and risk sharing have not recorded any growth. financial integration has shown little progress in terms of cross - border bank lending and equity markets. yet these markets are key to helping small and medium - sized enterprises – the backbone of the euro area economy – overcome their financing challenges. they are also a critical source of risk capital for innovative and high - growth companies, particularly in sectors such as technology, biotech and renewable energy. facilitating cross - border banking and removing barriers to cross - border crisis management cross - border lending can generate important benefits, especially in relation to private sector risk sharing across countries. banks can reduce the concentration and home bias of their exposures while borrowers can broaden their access to financing and strengthen funding resilience when the domestic market is under stress. yet, the european banking sector is still fragmented. over the past decade, little progress has been made in integrating banking groups across borders. and when consolidation in the banking sector does occur, it is often at the national level. 1 / 4 bis - central bankers'speeches despite the existence of a european supervisory and resolution framework, a number of prudential