by the banco de espana in 2013 that the cash dividends paid that year should not exceed 25 % of consolidated profit, would be relatively unusual in other countries. as you know, the recommendation made by the ssm supervisory board on this matter in january was only restrictive for those banks whose solvency ratios failed to comply with the minimum levels in line with regulatory requirements. the more formalistic approach to supervision to be found in other jurisdictions provides greater clarity regarding the scope of supervision. it also facilitates identification of the respective responsibilities of bank managers and supervisors. however, rigidly subjecting to strict rules and standards of conduct naturally reduces the supervisor ’ s ability to identify and correct in good time potentially destabilising developments for the bank. in the field of accounting, the experience of the asset quality review recently conducted by the ssm shows that there are appreciable discrepancies between the specific accounting criteria used in the different jurisdictions, although ifrs principles must be applied in all of them. in spain ’ s case, as i have already mentioned, the criteria followed are those established by the circular of the banco de espana on public and confidential financial reporting rules and formats ( known as the accounting circular ). in other countries the criteria applied have been established over time and, generally, with less involvement of the supervisor. the harmonisation of these criteria would be highly desirable, especially in relation to the classification of exposures ( an area in which the european banking authority has made notable progress in recent months ) and, in particular, provisioning policy. it should be noted that, although the supervisor may adjust the capital requirements, imposing higher levels of capital does not sufficiently make up for the lack of adequate provisions. that is because the level of provisions always has direct and transparent implications for the profit or loss of the bank, while an increase in the minimum capital requirements via pillar 2 is not usually transparent ( as the pillar 2 requirements are not public ) and, in most cases, does not have any practical effect, insofar as the bank has a capital buffer that enables it to cover the new requirements. accordingly, the supervisor should be concerned to promote the application of rigorous and uniform provisioning criteria involving the appropriate recognition on the balance sheet of the value of each exposure. clearly, the formal publication of binding accounting criteria by the ssm may be contested, insofar as accounting does not form part of its competencies according to the eu regulation under which it was set up. at the same

to the first decade of this century, but not as much as during the boom in apartment building in the second half of the 2010s. this is likely to still be enough to keep the housing stock growing faster than the population. solid rates of home - building have been encouraged by a range of public policy measures, including the low level of interest rates. also important has been the raft of subsidies and other incentives for home construction, as well as support for first home buyers during the pandemic. in combination, these subsidies have been quite sizeable in some cases ( graph 5 ). graph 5 maximum grants available * new home construction $ ’ 000 new south wales victoria % $ ’ 000 queensland western australia % h2 2020 homebuilder ( lhs ) first home owner grant ( lhs ) h2 2020 other * * ( lhs ) per cent of median housing price * * * ( rhs ) * subject to eligibility criteria including first - home - buyer status, income and property price caps. * * other includes regional bonuses in victoria and queensland, and the western australian building bonus grant. * * * median price of all new and established dwellings at the end of the reference period. sources : corelogic ; federal and state governments ; rba it is difficult to disentangle how much of the increase in demand for housing has reflected temporary subsidies and the current low level of mortgage rates versus the shift in preferences. however, it is clear that the time - limited nature of homebuilder and some other subsidies induced a temporary surge in building approvals for detached homes and renovations ( graph 6 ). we estimate that about one - quarter of building approvals during this period were supported by homebuilder, though many of these would have happened anyway. graph 6 private residential building approvals * monthly ’ 000 detached ’ 000 new dwellings higher - density $ b $ b alterations & additions 1. 0 1. 0 $ 25, 000 * * 0. 8 0. 8 0. 6 0. 4 0. 6 $ 15, 000 * * * * * 0. 4 smoothed lines are 13 - period henderson trends. grant value by phase of the homebuilder program. sources : abs ; rba even now, after eligibility for these subsidies has closed, these categories of building approvals have remained higher than immediately before the pandemic. this suggests that the extra demand induced by the subsidies wasn't entirely pulled forward from this year and next year, which would