to implementing reforms related to the eu acquis communautaire. it requires progress in the economic, legal and political domains. twinning projects help achieve exactly that : they assist in building a more democratic and open economy in ukraine. and they are always a two - way street : in these projects, institutions exchange, rather than transfer knowledge, thus broadening the perspective of everyone involved. the same applies to this twinning project for the nbu as well. it is a knowledge - sharing mission that will contribute to ukraine in fulfilling its european aspirations. 1 / 2 bis central bankers'speeches ladies and gentlemen, to paraphrase president reagan, the nbu is a shining city upon a hill whose beacon light guides freedom loving people in ukraine. and i am far from exaggerating. its achievements, professionalism as well as commitment as an independent and transparent central bank, delivering price and financial stability, cannot be overstated. its collaboration with international financial institutions, including the international monetary fund ( imf ), has helped ukraine remain on the path towards a more stable and prosperous future. from reforming the banking sector to undergoing a fundamental internal transformation, the nbu has skilfully navigated through often turbulent waters, gaining credibility in the eyes of partners and observers around the world. therefore, the prestigious central banking transparency award, granted to the nbu in 2019, was indeed well - deserved. the nbu ’ s culture, values and openness, its responsibility and clear communication has helped it achieve a hard - won trust with stakeholders and the general public. today, the nbu continues to establish itself within the international central banking community. i congratulate the nbu for recently becoming a member of the sustainable banking network as well as the network for greening the financial system. it displays the nbu ’ s commitment to building a more sustainable and greener financial system. i can therefore candidly say on behalf of the bank of lithuania that it is an honour and a privilege for us to work with the nbu in this project. i am confident that the twinning project will represent a qualitatively new stage in cooperation between our central banks, bringing about concrete results in the areas that it covers. ladies and gentlemen, i would also like to extend my appreciation to the colleagues leading the project from the narodowy bank polski ( nbp ) – an institution at the very top of the league of central banks. thanks to them the bank

price growth was very steep : within 4 years real prices almost tripled. back then we didn ’ t have macroprudential policy and, when the shock hit our financial system, we experienced the deepest fall in real estate prices ever seen in our country. we lost around one third of the market value of residential real estate. unemployment tripled. and gdp contracted by 15 per cent. we experienced one of the deepest economic recessions in the eu. thankfully, it was also one of the shortest ; although we achieved the recovery through great pains. 1 / 3 bis central bankers'speeches or if we were to look towards the other shore of the baltic sea and recall sweden three decades ago, where, by the beginning of the ’ 90s, real estate values and stock prices had more than doubled. soon after – the price bubble blew up. half of the property value was lost. and – that left the swedes to deal with very painful consequences for their economy. dear stefan, maybe later you will share your thoughts on how to prevent history from repeating itsel? from our side i can firmly say that after muddling through the turmoil, we learned our lesson. we took actions. the bank of lithuania now has the mandate to shape macroprudential policy. this is a big responsibility and i am confident that we are delivering on the mandate of financial stability. we have a number of well - targeted measures, which, i believe, are doing their job. had these tools been in place before 2008, the cycle would have been smoother. and the negative consequences for our economy wouldn ’ t have been so dramatic. however, despite actions taken and ammunition obtained, my colleagues at the bank of lithuania encourage asking ourselves whether we could do more. and i do agree with them – in - depth analysis and discussions are very welcome. when doing more, it seems obvious to intervene somewhere at the start of the cycle. and if, for example, easy money is needed to invigorate real economy, then we could maybe do something about a probable speculative bubble. something like setting the speed limit on real estate price growth and then using prudential policy measures to steer the real estate sector when needed. but maybe we should target real estate imbalances instead? if, for instance, we witnessed that housing prices increase much faster in the big cities than they do outside, it would make sense to consider these imbalances as well. we could adjust and use measures, which are already