ssm in more detail and how i expect it to affect the supervision and practice of banking in europe. there are six points i would like to highlight. first, i expect the ssm to implement the most advanced supervision of banks. this means, of course, using all the modern methods to be forward - looking and risk - based, focusing on the viability of banks ’ business models, the robustness of their balance sheets to shocks and the evolution of their liquidity and funding positions over time. this is the basis on which we are currently designing the single supervisory model which will apply to all banks in the ssm – not only to those that are directly supervised by the ecb. second, the ssm will have to address the problems created by the heterogeneity in the way that banks calculate risk - weighted assets. even though euro area banks have a healthy median core tier 1 capital ratio of above 12 % of risk - weighted assets, investors seem to still have concerns about their robustness due to lack of transparency on how they calibrate their internal risk models, as well as differences in how models are validated across jurisdictions. the ssm should create more homogeneity by imposing common principles about methods and models ’ parameters in order to improve the reliability of banks ’ internal models. the basel committee is also discussing how to address this issue and some countries have see “ the european crisis and the role of the financial system ” speech by vitor constancio, vice - president of the ecb, at the bank of greece conference on “ the crisis in the euro area ” athens, 23 may 2013. http : / / www. ecb. europa. eu / press / key / date / 2013 / html / sp130523 _ 1. en. html. see williamson, j., “ comment ”, in bergsten, f. ( ed ), international adjustment and financing : the lessons of 1985 – 1991, institute for international economics, 1991, p. 243. bis central bankers ’ speeches recently introduced minimum floors to risk weights of some types of assets. the ecb / ssm will ensure that, both within and across countries, the same types of risks are given similar weights. third, the ssm will lead to a harmonised treatment of non - performing exposures and provisioning rules, which at present vary between jurisdictions and are not directly comparable for investors. the european banking authority ( eba ) has recently released technical

well as the regular discussions at the “ efc stability table ”. however, supervisors and central banks in the eu have also taken precautions for the event of a crisis. in 2003, for instance, the bsc reached an agreement on cross - border cooperation and on the exchange of information between supervisory authorities and central banks. in 2005, the finance ministries joined this agreement. to avoid any misunderstanding : we are not talking here about guaranteed financial assistance for individual institutions. all the institutions involved agree that responsibility for solving problems rests first and foremost with the market players themselves. nevertheless, a framework for the better handling of systemic risks has been put in place. iii despite all this progress, there are still many items left on the agenda. let me pick out three of them. europe ’ s supervisory structures are under non - stop scrutiny. just recently, the “ inter - institutional monitoring group ” presented its 2007 interim report on the lamfalussy procedure. the report calls for greater efforts in making progress with level 3 supervisory cooperation – which, for banking supervision, means within cebs. i rate this, first of all, as an endorsement of the cooperative model of supervision in europe. that further efforts are needed is beyond dispute, and this is something of which all the responsible national supervisors are aware. what is important, however, is that these structures – which were created only a few years ago – are given the necessary time to achieve the consistent progress. even so, there are occasionally calls from some banks to move european supervisory structures in the direction of a “ lead supervisor ” or even a centralised european supervisory authority to supervise large institutions active throughout europe. most european banking supervisors 1, including the bundesbank, have tended to be critical of this idea in their initial analyses. in its white paper, the callum mccarthy ( fsa ) says this about the idea of a “ lead supervisor ” : “ instead of this approach, we should recognise that regulation of pan - european groups requires collaboration among regulators. we must be more efficient in how we go with this. but pretending we can achieve better european regulation by simply ‘ allocating ’ the task to one regulator is not the answer. ” commission, too, has advocated stepping up cooperation within the established structures and pressing ahead with the convergence of supervisory rules. still, please allow me to make some remarks on the concept of a “ lead supervisor ”. in this supervisory model, the home - country supervisor responsible for the parent of a financial group would take on the function