tangible total assets of 6. 2 %, using us accounting standards ( us gaap ), whereas the main european banks have a level of 3. 7 % when using ifrs accounting standards. however, according to fdic calculations, if the us banks ratio would be calculated according to ifrs, the same as in europe, the ratio comes down to 3. 8 % very similar to the european level. when calculated with the same accounting standards the average leverage ratios of the large american and european banks are quite similar. the explanation for this has to do with netting rules : under the us gaap the american banks have total assets of 10 trillion dollars but applying ifrs that is changed into 16 trillion dollars. this huge difference explains the difference in the leverage ratios but, importantly, has necessarily to impact also the published risk - weighted capital ratios of european and american banks. this means that the capital ratios are then not comparable although that is many times ignored by market and media perceptions, clearly to the detriment of european banks. third, the restructuring efforts in the stressed countries to strengthen their banks with the help of the european stability mechanism ( esm ) funds have led to improved funding conditions for euro area banks. with the financing provided by the esm, banks in spain, portugal, greece and ireland have been recapitalized. bank deposits in these countries have risen by around 200 bn since september last year, and the cost of both deposit and bond funding for banks has fallen significantly. euro area banks ’ issuance of medium and longterm debt has increased and we have also seen a noticeable pick - up in repo market activity. all these changes have led to lower use of central bank liquidity. hundreds of banks have made use of the option to repay the liquidity provided through the ecb ’ s three - year longerterm refinancing operations. these repayments amount to some €300 billion, more than half of the net liquidity injection of 500 bn, provided by our two big ltro operations. our lending to bank counterparties has declined from 14 % of the euro area gdp at the peak to around 8 % today. despite these positive trends, there is still a negative perception in the market about european banks and more measures are indeed necessary. the fact that improved bank fundamentals have not been translated into higher price - to - book ratios tells us that there is a confidence problem as regards euro area banks. and if this is left unaddressed

global demand and hence global rebalancing. euro area countries are currently taking a series of policy measures both to raise their growth potential and to make growth more sustainable. they are achieving greater sustainability by moving towards an economic model based less on external borrowing and more on internal competitiveness. indeed, according to harmonised competitiveness indicators based on unit labour costs have all registered significant improvements since 1999, ireland ( – 19 % since 1999 ), spain ( – 9. 5 % ), greece ( – 9 % ), and portugal ( – 6. 6 % ). the loss of competitiveness accumulated until 2007 has been totally offset since the beginning of the crisis. as a consequence, the eu commission forecast for this year is that all stressed countries will show a surplus on current account with the exception of greece with a deficit of just 1. 1 % of gdp. bis central bankers ’ speeches and euro area countries are increasing their growth - potential by implementing wide - ranging structural reforms. these include product and labour market measures, but also deeper reforms to tax systems, public administration and the judicial system. our monetary policy has been helping this process by improving our transmission mechanism and stabilizing markets. the decision taken last year on the programme of outright monetary transactions ( omt ) has been decisive in this respect. our recent decision to provide forward guidance regarding our main policy rate was also successful in stabilizing financial markets unduly affected be spillovers from the recent fed announcement of future tapering of quantitative easing ( qe ). europe is behind the us in economic recovery and inflation risks which implies that monetary policy has to stay accommodative for a longer period of time. our forward guidance is in line with our policy framework as it does not refer to any date or period of time but is instead totally conditional on developments in inflation prospects, in the economy and in money and credit aggregates – the pillars of out monetary strategy. at the same time, policy measures are underway at the european level that could help expedite this rebalancing process. these include initiatives by the european investment bank to boost lending to smes, and the possible introduction of contractual programmes with financial incentives to underpin structural reform implementation in stressed countries. a proposal by the european commission on the latter is expected before the end of the year. channel two : a stable financial system through banking union the second channel through which euro area developments can have a global impact is the process of building a genuine banking union in