from the riksbank, which is positive. but a larger number of institutions, and new types of institutions, becoming participants in rix could also lead to the risks of other problems increasing, such as operational problems, money laundering, financial problems and cyber threats. it is therefore important that the riksbank regularly oversees the participants in rix and has the power of authority to make strong demands of them. thus it is essential that the sveriges riksbank act provides sufficient flexibility in this respect. function as lender of last resort – emergency liquidity assistance a third important part of the central banks ’ responsibility for the efficiency and stability of the financial system is the task of providing emergency liquidity assistance. one usually says that the central banks are the lender of last resort. the need to have a “ liquidity emergency service ” is based on normal banks ’ operations being characterised by borrowing money at short maturities and then lending this money at longer maturities. this is the so - called maturity transformation that exposes the banks to liquidity risk. sometimes the banks ’ access to funding may suddenly decline, without it being possible – or socio - economically desirable – for them to reduce their lending at the same pace. this does not usually lead to any problems. a bank that needs more funding can normally borrow from other banks that have a surplus ( or it can issue its own bonds ). however, sometimes the liquidity problems are so serious that the banks cannot manage them on their own. if, for instance, confidence in a bank were weakened so that depositors feared they would not be able to get their money back, the bank might be subjected to a bank run that it is unable to manage on its own. there is also a risk that problems in one bank may spread to other banks, as the banks are interconnected. even banks that do not have any problems may be affected as a result of rumours spreading. if the banks also obtain a large share of their financing on the markets – as the swedish banks do – then a crisis of confidence in an individual bank or the entire banking sector, or the economy as a whole, could also lead to the funding 5 being withdrawn, especially if the foreign share of the funding was substantial. this could also lead to acute liquidity problems for one or more banks. in other words, in a crisis, liquid funds are often in short supply. the financial markets that offer funding often function less well than usual and the declining confidence between

40 billion above the benchmark amount. in the following weekly operation on 16 october, the allotment exceeded the benchmark amount by eur 18 billion, and in yesterday ’ s tender we allotted more than eur 14 billion above the benchmark amount. indeed, the difference between the allotted and the benchmark amount is envisaged to decline gradually in the course of the maintenance period, taking into account the prevailing market conditions. and the ecb still aims at balanced liquidity conditions at the end of the maintenance period. besides, the ecb intends to steer liquidity towards more balanced conditions also during the maintenance period, in a way which is consistent with the objective to keep very short term rates close to the minimum bid rate. we have also stated our commitment to keep this policy in place for as long as needed. before turning to the current situation in the market, let me stress a very important point. through the liquidity operations just discussed, the ecb has contributed to the orderly functioning of the money market, which is one of its key responsibilities. it is worth emphasising, however, that the ecb ’ s primary mandate calls for its monetary policy to deliver price stability. the two responsibilities are clearly distinct and should not be mixed. this is our concept. only when kept separate, the fulfilment of both duties can reinforce each other. current situation let me now turn to the main issues that characterise the nature and dimension of the current tensions in some segments of the financial markets. the so - called benchmark amount is the amount of liquidity that is needed for the banking sector to fulfill their reserve requirements in a smooth fashion over the course of a maintenance period. usually, the ecb supplies roughly this amount in its weekly refinancing operations. although the ecb interventions have had a stabilising effect on the euro money market rates at the shorter end of the term structure and, more generally, the money market has recovered some of the lost ground, market participants continue to report limited trading activity, particularly in unsecured inter - bank term markets. compared to the situation prior to the emerging of tensions, unsecured deposit rates beyond one month are in some cases ( notably, three months ) still significantly higher and turnover remains lower, despite some improvement during the past few weeks. this situation reflects two main factors. • first, some banks ’ daily funding needs, especially in usd, have significantly increased at various points in time in the recent past