have a duty to serve : equality, legal certainty, individual rights, and good administration. this concept of proportionality has recently become a major theme in pan - european discussions of banking regulation – and for good reason. it subsumes more specific discussions on better regulation, simplification and the need for differentiation. and it provides a framework for the evaluation of existing rules and practices, and a compass for their elaboration and improvement. why has this debate gained traction now, and not in the past? i believe that three specific aspects of the post - crisis regulatory architecture explain, and also justify, the emergence of proportionality as a core concern in european banking regulation. these three aspects of the post - crisis european regulatory architecture have greatly increased the significance of the matter : first, the shift from the old approach to prudential standard - setting for credit institutions, which was based on no more than a minimum harmonization at the european level, to a new system of almost full europeanization of the applicable norms. the intensive legislative activity which followed the global financial crisis, culminating in the enactment of the capital requirements directive iv and the capital requirements regulation, has resulted in much greater uniformity, verging to full harmonization, of the regulatory norms. the new state of things is epitomized in the construction of a single rulebook of pan - european applicability, with the eba acting as the rulebook ’ s custodian and key developer. second, the considerable expansion of the prudential regime to cover new aspects of a bank ’ s organization and business activity. this thematic extension is evident both in the basel regime, which, beyond the usual capital adequacy requirements, now encompasses global standards for liquidity and leverage, as well as in the host of european legislative initiatives of recent years. as a result, the net of supervisory controls over the activities of credit institutions and other financial intermediaries has become much denser than what it used to be. this makes the question of proportionality of the regulatory requirements all the more pressing. third, the move from a system of national responsibility for supervision to the streamlined, and largely centralized, new supervisory architecture of the banking union. under the pre - existing system, the european norms, such as they were, could be individuated and amplified at the national level, thus leaving the question of diversification and proportional implementation largely within the responsibility and discretion of national legislatures and competent authorities. in contrast,

a complement, to a well - functioning banking union. ladies and gentlemen, this conference was conceived from the very start as a forum for discussing in depth these issues. as things have turned out, the discussion now takes place in the context of the european commission ’ s banking reform package, which was made public on november 23. this includes proposals for the revision of the main ( level 1 ) instruments of the union ’ s single rulebook, that is, the capital requirements directive iv, the capital requirements regulation and, in so far as the resolution regime and, especially, the resolvability and loss - absorbing capacity of credit institutions is concerned, the bank recovery and resolution directive and the srb regulation. the commission ’ s package enhances and brings up - to - date the post - crisis prudential regime by transposing into european law those elements of the global basel iii standards which have been fully specified after the enactment of the capital requirements regulation in 2013. it thus includes substantial new rules on a binding 3 % leverage ratio, detailed provisions on credit institutions ’ liquidity requirements, and provisions, requiring institutions that trade in securities in derivatives to maintain more risk - sensitive own funds. moreover, it implements the financial stability board ’ s new total loss - absorbing capacity ( tlac ) standard for the 30 global systemically important institutions, almost half of which are european. in a very promising development, the commission used this opportunity in order to introduce significant elements of proportionality in the single rulebook. based on extensive public consultation and impact assessments relating to the crd / crr regime, it has included in its package a set of important proposals that are explicitly intended to make the prudential regime more proportionate and to reduce the burden faced by smaller and less complex credit institutions. the proposed amendments affect, in particular, the disclosure, reporting and tradingbook - related capital requirements. furthermore, they differentiate the treatment of certain financial instruments, such as covered bonds, high quality securitization instruments, sovereign debt instruments and derivatives used for hedging, with a view to reducing the costs of issuing or holding such instruments, thus enabling the continuing participation of banks in the relevant securities markets. in this manner, the regulatory regime is differentiated to facilitate the deepening of european capital markets and the creation of the capital markets union. one could argue that the inclusion of strong elements of proportionality in the banking reform package marks a move away for the traditional tendency of european law to regulate financial