to highlight the latest developments in these areas. i will just describe some specific elements of our recent internal reorganisation at the ecb which are geared towards improving the quality of our governance function. firstly, the ecb has created a new position in 2015, the chief services officer ( cso ), responsible for matters pertaining to administrative services, it services, human resources and finance. secondly, the executive board of the ecb decided to create an independent finance department, reporting to the cso and responsible for budgeting and controlling, financial and cost accounting, financial reporting and procurement. finally, also in 2015, the ecb decided to establish a dedicated compliance and governance office ( cgo ) as a key risk management control function to strengthen the ecb ’ s governance framework. the purpose of this office is to support the executive board in protecting the integrity and reputation of the ecb, to promote ethical standards of behaviour and to strengthen the ecb ’ s accountability and transparency. to this end, the new cgo performs activities relating to the ecb ’ s revised ethics framework and other governance activities. ladies and gentlemen, the four sessions of today and tomorrow provide a representative sample of current key topics and challenges for central banks worldwide. i therefore wish you a productive and inspiring conference. bis central bankers ’ speeches

part of that, the ssm is working to take stock of supervisory best practices. more action is needed to address shortcomings in insolvency, collateral and taxation frameworks. accounting standards are also important to address the issue. in the us, accounting standards require us banks to reduce, after six months, their npes to the market value of their collateral, if any. balance sheets are therefore cleaned up of bad loans rather swiftly. this illustrates how accounting standards interact with supervisory concerns. until now, the incurred loss model has been applied under ifrs which does not impose a timely treatment of npes by the banks. as a consequence, npes accumulate in banks ’ balance sheets, consuming capital and not contributing to banks ’ profitability. the introduction of ifrs 9 as from 2018 will change this situation. the ecb has already publicly expressed its support for a swift endorsement of ifrs 9. in our view, the new requirements for the classification, measurement and impairment of financial instruments, as well as the new general hedge accounting model, constitute an improvement over the previous requirements in ias 39. moreover, we believe that some aspects of the non - performing exposures ( npes ) can be defined as impaired exposures and past due ( > 90 days ) exposures. the ratio of non - performing loans refers to the ratio of non - performing loans to total gross loans. bis central bankers ’ speeches new standard may be an improvement from a financial stability perspective. the merits of the new expected credit loss model will clearly depend on its proper and consistent implementation in the financial sector. in this perspective, it is important that more granular instructions are given by the standard - setters and regulatory authorities in order to ensure that the implementation of the new standard is not subject to different interpretations that would not respect a proper level playing field. at the same time, it will be crucial to monitor the application of ifrs 9 in order to ensure that there are no unintended cyclical consequences of its implementation. in the us, the fasb just announced the approval of similar standards that nevertheless will only start to be applied in 2020. us banks have been critical of what will be a major change in frontloading provisions for credit risk. the introduction of both new standards will be a substantial change that will affect banks, already subject to more demanding regulation to which new features will continue to be added until year - end, albeit with the promise of not leading to a “ significant increase in capital