required a radical and fast change in the central bank ’ s mentality. this was perhaps the biggest challenge that the cnb had to face. over the past five years it has involved much work on improving our forecasting tools, leading to substantial development in our internal analytical processes. these changes culminated at the beginning of 2002, when the cnb settled on a new forecasting process. this integrates expert judgment and short - term analyses – which were the key pillars of the cnb ’ s forecasting tool - kit in the first years of inflation targeting – with a small - scale macroeconomic model developed by the cnb ’ s staff with the assistance of the international monetary fund. an important element of this step was a switch from a forecast with a fixed - interest - rate assumption to an unconditional forecast that includes a reaction function of the central bank. the established quarterly projection model was a small - scale model belonging to the first generation of such models. it was thus fairly simple and arguably missed many important links in the economy. nevertheless, it was already quite close to the state - of - the - art among the inflation - targeting central banks around the world, and intense work has been in progress to build a higher - generation model. we are now just about ready to use regularly our newly developed so - called “ third generation ” general equilibrium model, which is fully based on micro specifications. of course, expert judgment and shortterm analyses still play an important supplementary role in the design of the final forecast. the good standard of our current forecasting know - how is reflected, among other things, in our ability to start providing technical assistance in the forecasting field to some other central banks in transition and emerging market economies. it is clear that the development of the forecasting system has not always been straightforward and easy. during the first years, many of the details were adjusted in response to the changing needs, challenging experience and evolving thinking of the central bank. given the legacy of the communist period and the lack of available data, we were forced to leave out, unfortunately or fortunately, the period of large - scale econometric models. first, there was no experience with that kind of modelling in our communist history. second, the reliable data series start in 1994, which significantly constrains the proper use of econometric techniques. therefore, our macro models have relied heavily on calibration. despite, or maybe because of, the latter, they seem to provide consistent guidelines

mojmir hampl : the eu banking industry speaking points by mr mojmir hampl, vice governor of the czech national bank, at the european economic congress “ section : banking industry in the eu ”, katowice, 15 may 2012. * * * “ dzen dobry ” – this is unfortunately the only thing i can credibly say in polish, so the rest will be in my imperfect english. thanks to the organizers for the invitation and for the opportunity to participate in such a distinguished panel. it is my first time here and i can only hope not the last one after i finish my presentation. given the time constraints i will focus on a just a couple of quick points to stimulate the debate. my key point is : let ’ s not repeat the same mistakes again and again. what i mean is this : since the onset of the current crisis there has been a constant push for a more pan - european, or “ federal - like ”, approach to the regulation, supervision and potentially also resolution of the financial industry in the eu. the famous de larosiere report and all its consequences, such as the three new pan - european supervisory agencies, are just direct results of this push and this way of thinking. some may recall that the czech authorities were quite reluctant to accept this approach and also the final compromise which brought these agencies into existence, and we believe we had good reasons for this. despite all the european convergence and integration, financial systems in different eu member states still look and work very differently. trying to administer them from a single centre according to a single set of rules might be like trying, say, to feed all the animals in a zoo with a single type of food. as an illustration : the recent ecfin retail banking survey says : in austria almost 100 % of house purchasing loans feature variable interest rates, while in france the share is only about 10 %. countries differ substantially in the share of owner - occupied housing and therefore in the importance of the mortgage market ; they differ in how intensively they use electronic means of payment ; in the significance of building societies and credit unions ; in tax and other incentives that the government provides for certain types of financial transactions ; in the extent to which local banks trade in various non - plain vanilla products such as derivatives ; in the share of subsidiaries and branches of foreign financial institutions and, more generally, in ownership structure in the loan - to - deposit ratio, which varies from roughly 70 % in some countries to more