foster the development of sustainable microfinance and rural financial institutions to cater to the vast agricultural and microenterprise sector. they can do so by adopting regulatory requirements which suit the limited sphere of activity of these institutions. 5. conclusion ladies and gentlemen, let me conclude these brief introductory remarks. how can we assess the contribution of central banks to improving the business environment in africa? most african central banks have been successful in reducing inflation. this enables the private sector to plan ahead and engage in contracts without worrying excessively that their proceeds may be eroded by rapidly rising inflation. central banks have also fostered improvements in the payment system, which have reduced the costs of accessing and transferring money for businesses and households. the cash intensity of most african economies suggests, however, that there is still room for improvement in this area. a greater challenge for central banks lies in fostering growth and efficiency in the financial sector. the banking sector in many countries of the continent remains small and sadly displays a low level of efficiency and competition. i sincerely hope that this forum will contribute to finding solutions to these and other challenges to emerging africa. let me close by wishing you a successful emf here at the study center gerzensee.

thomas j jordan : financial stability report – potential risks and actions introductory remarks by mr thomas j jordan, vice chairman of the governing board of the swiss national bank, at the half - yearly media news conference, berne, 16 june 2011. * * * in my introductory remarks today, i would like to present the most important points from our recently published financial stability report, in which we consider potential risks to financial stability and identify where action may be needed. general economic and financial conditions for the swiss banking sector improved further in 2010. overall, global economic growth was stronger than expected last year, despite the expiry of fiscal stimuli. in switzerland, too, economic development was robust and growth was high in an international comparison. against this background, the profitability and capital situation of both big banks improved further, and remained good for banks with a domestic focus. however, the economic environment remains fragile, and a renewed, sharp deterioration over the next twelve months cannot be ruled out. in the short term, the prevailing uncertainty primarily affects the two big banks, which are still exposed to considerable credit and market risk relative to their loss - absorbing capital. for domestically focused banks, by contrast, the risks are largely of a medium - term nature, and are related to potential adverse developments on the swiss real estate and mortgage markets. in view of these risks, all swiss banks should ensure that they have a broad and high - quality base of loss - absorbing capital. for the big banks, in particular, it is crucial that a sufficient capital base be laid down as soon as possible, so that losses can be fully absorbed. the snb welcomes the fact that, in 2010, both big banks already took important first steps in this regard, and we would like to encourage them to keep up the pace of their capital expansion. the capitalisation of most domestically focused banks is good by historical standards. however, a combination of high interest rate risk exposure and strong mortgage lending growth has been reported by a number of banks. in order for these banks to bear the risks in the medium term, it is important to ensure that their capital base is strong enough. i would now like to take a closer look at the situation of the two big banks, before turning my attention to the situation of the domestically focused banks. situation of big banks compared to 2009, the two swiss big banks saw a marked improvement in their profitability and capital situation last year. in 2010, these institutions reported combined net profits of around chf