. in the meantime, lending has improved and fragmentation within the euro area has practically disappeared. but could new tltros be needed all the same? if these loans have a residual maturity of at least one year, the banking supervisor categorises them as long - term financing. the first tltro tranche expires in june 2020. this will start to have effects on the net stable funding ratio as of mid - 2019. the banks are aware of this and they have been preparing themselves for it. it is premature to decide on a new tltro now. as of january, the ecb no longer wants to make net asset purchases but only to replace maturing securities. how exactly will that be done in practice? the principle is that we take a market - neutral approach. in december we will discuss the guidelines for our reinvestments. you have said that forward guidance on monetary policy will become the ecb ’ s most important instrument in 2019. this will also increase dependency on the markets. how long will this go on for? forward guidance is particularly important as long as the economy still requires support and the central bank ’ s policy rate is at its effective lower bound. significant monetary policy stimulus is still needed at present. we expect the key ecb interest rates to remain at their present levels at least through the summer of 2019, and in any case for as long as necessary to ensure the continued sustained convergence of inflation to levels that are below, but close to, 2 % over the medium term. in due course, when monetary policy begins to normalise and uncertainty abates, forward guidance will also lose importance as a monetary policy instrument. will the first step be to increase the interest rate on the ecb ’ s deposit facility from – 0. 40 % or the interest rate on the main refinancing operations from 0. 00 % – or both at the same time? the rate on our deposit facility is currently decisive for the market rate, and so for the transmission of our monetary policy signal, because the banks are operating in an environment of excess liquidity. as that situation will continue for some time to come, the deposit facility rate remains the most important monetary policy instrument. however, it is still too early to discuss any adjustment to our key interest rates and their constellation. let ’ s look beyond monetary policy. what do you see as the most serious deficiencies of the euro area? 3 / 4 bis central bankers'speeches the franco -

german agreement on a fiscal capacity is welcome and also has important political significance for european integration. building up the esm rescue fund is more urgent. we also need to complete the banking union and the capital markets union without undue delay. the banking union envisages a common deposit insurance scheme. germany has serious misgivings that this would amount to risk - sharing. a common deposit insurance is essential for the completion of the banking union and to underpin the confidence of all depositors in the financial system. this protection of deposits up to €100, 000 will be funded by contributions from banks. but this scheme is just one of the components that are necessary to make the banking sector more resilient and safeguard financial stability. it is of the utmost importance to implement the rules for bank resolution which stipulate that at least 8 % of banks ’ liabilities should be made up of instruments that could absorb losses in the event of bank failure. in my view, all of these instruments should be either equity or subordinated bonds so that all customer deposits would be effectively protected. we have now talked a lot about problems. let ’ s now ask what you see as the greatest achievement of the euro? citizens have overwhelmingly embraced the euro. people appreciate how it brings europeans closer together. many aspects of everyday life have become easier, such as doing business or travelling. the level of acceptance is high in all euro area countries. let ’ s look ahead : your term of office expires at the end of may. do you have any regrets? i am confident that the sustained convergence of inflation to a level below, but close to, 2 % over the medium term will proceed. i will be here for another six months, and i expect to see further progress towards our aim by the end of my mandate, but i will clearly have to leave before the normalisation of our monetary policy. to be successful in our monetary policy we need to be patient, prudent and persistent. 4 / 4 bis central bankers'speeches