close trading partners and our financial centres would retain their close ties – our supervisors would work together to ensure high regulatory standards, without imposing undue burdens on firms. let ’ s not be unrealistic : achieving such cooperation is highly challenging. we need to define the areas in which we want to cooperate, and to what degree we want to cooperate – this will be difficult politics. but it is worth trying to save the post - war order – by developing it further. we can all further that cause : by finding solutions that respect the legitimate interests of countries wanting increased national autonomy and the need to continue global economic cooperation. the bundesbank ’ s representative in london furthers that cause. ms julia becker has done an excellent job over the past two and a half years : she played a vital role in the exchange between the bundesbank and the bank of england, and she was instrumental in shaping our brexit analysis. i am pleased that after a short family break, she will continue to perform an essential role at our frankfurt headquarters. i am also confident that ms olga wittchen will continue this successful track record. coming from our directorate general for banking and financial supervision, she is an expert in international banking regulation. i have worked with her on several projects on the financial stability board – and i am convinced that she will put her skills towards fostering cooperation between britain and germany. 7. conclusion ladies and gentlemen 3 / 4 bis central bankers'speeches henry l mencken, an influential american writer of the early twentieth century, once said : " for every complex problem there is an answer that is clear, simple, and wrong. " let ’ s search for answers that are right – and let ’ s expose oversimplified, misleading ideologies – neither nationalist populism nor hyper - globalisation will lead to prosperity and security. global economic cooperation has helped us to build a more prosperous society. however, it does have side effects. only by reducing and managing these side effects can we foster global cooperation in the long term. focused global cooperation promises a way forward. we should all put our minds together to decide how this can be best achieved. thank you for your attention. sam : the floor is now yours. 1 d rodrik ( 2000 ), how far will international economic integration go? in journal of economic perspectives : 14 ( 1 ) : pp 177 - 186. 4 / 4 bis central bankers'speeches

in the real economy is not managed well, balance sheets of financial institutions might be impaired as well. the impact of structural change will not be confined to the real economy. digitalisation, in particular, is an important driver of structural change within the financial system. thus, preparation is needed for scenarios that require dealing with financial institutions that have unviable business models. an evaluation of the too - big - to - fail ( tbtf ) reforms concluded by the financial stability board ( fsb ( financial stability board ) ) in 2021 provides guidance. the report showed that the tbtf reforms have made banks more resilient and resolvable, and that they have delivered net benefits to society. however, resolution reforms need to be implemented in full to enhance the feasibility and credibility of resolution, minimising the need for state support of failing banks. more needs to be done in terms of removing remaining obstacles to resolution, in terms of improving information and enhancing transparency. monitoring of domestically important banks and of risks from a shift of activity to non - bank financial institutions needs to be intensified. in addition, accelerated structural change requires conceptual work on the longer - term implications for the financial system. recall how financial stability is typically defined : as the ability of the financial system to function even during periods of stress and structural change. however, monitoring of vulnerabilities in the financial system tends to focus on the functioning of the system during periods of financial stress. we have few analytical tools to assess how the financial system would operate during a process of structural change : most macro models focus on shorter - term dynamics, but structural change is, by its nature, hard to predict and model. we need a better understanding how both rapid structural change but also a delayed process will affect the financial system. rapid structural change can lead to a revaluation of existing assets and to losses on financial institutions ’ balance sheets. if, in contrast, structural change is delayed, ( hidden ) losses may accumulate in the financial system over time. if the financial sector does not have sufficient buffers to absorb losses, this can have negative repercussions for the real economy. we need to understand how public policy shapes the process of structural change, how the financial sector contributes, where risks are located, and who bears these risks. hence, we need frameworks to assess the financial stability implications of structural change. the following issues are particularly important : first, the climate transition requires innovation. this, in turn, requires governance and financing