the ground for this flexible approach. concluding remarks let me conclude. european economic growth prospects are favorable. euro area economic diversity is a fact of life, but not very different from the us situation. admittedly, the european economy has considerable progress to make in structural reform. but the improvements so far are genuine and are likely to last. closer european cooperation on economic and political issues is under way. if i may quote the american economist lester thurow from his 1992 bestseller head to head : ‘ future historians will record that the 21st century belonged to the house of europe ’. end of quote. in this environment, a common european culture is emerging. as of january 1, 2002, euro notes and coins will give european citizens a concrete sign of their common identity. nonetheless, some cultural differences will remain, just as in the us. joe - six - pack as the average american is only virtual reality. i am sure that someone from new jersey is very different from someone from texas. also in europe, we will keep national traditions. i was born dutch. now i feel european, but a dutch european. i am proud of that.

is the responsibility of its board, and its operations are in the hands of management. it goes without saying that proper control systems and governance structures are of paramount importance. as regulators, we have to rely on the accounts given to us by the bank as the basis for our risk assessment, and these will have been signed off by both the internal and the external auditors. the auditors, in turn, rely on the information provided to them and cannot be held responsible if they are misled by fraudulent activities. however, if they are complicit in the misstatements or irregularities in the running of the bank, they will be held accountable. page - 6 - of 9 regulators cannot prevent banks from failing if bad or illegal business decisions are made. our role is to ensure that bank failures do not put the entire banking and financial system at risk. the issue of the integrity of company audits was also in the spotlight with another potential financial stability risk. the collapse of the share price of steinhoff international holding nv, following the announcement of an investigation into alleged accounting irregularities, raised concerns about the exposure of south african banks to the company. fortunately, the company ’ s debt is mainly concentrated in foreign banks, and the impact of a potential default on loans on the domestic banking system appears to be limited. during the past year we also had to deal with the potential risks posed by a questionable report on capitec bank and the subsequent short - selling of the bank ’ s shares, which caused some volatility in its share price. the sarb ’ s view is that capitec bank is well capitalised and has sufficient liquidity. the share price has since clawed back most of its losses, and there was no run on the bank. at the previous agm, i reported on our challenge to the public protector ’ s ruling on the legality of the sarb ’ s assistance to bankorp over 30 years ago as well as her finding that absa, as the purchasing bank, was liable to repay the facility. we were particularly concerned about the binding remedial instruction to parliament to set in motion a process to change the constitutional mandate of the sarb away from price stability. we challenged this remedial action, as well as the public protector ’ s other findings. the judgement, as you may know, went in our favour. the entire report was set aside, and we have finality on these issues. our mandate, to protect the value