with other institutions from their network. as such, the single rule book runs counter to the idea of a level playing field and creates problematic incentives in terms of uniformity and size in the banking sector. regulation today already takes account of proportionality to a degree. tiered standards exist in areas such as reporting, where large institutions are required to meet more frequent and comprehensive reporting standards, and supervisors largely exercise proportionality when applying the minimum requirements for risk management. proportionality is also embedded, in principle, in the eba guidelines on the supervisory review and evaluation process. but in practice i repeatedly encounter situations where the existing gradations are inadequate in my eyes. the proportionality principle is nothing new, then, but it still has not been anchored deeply enough. 4. the road to greater proportionality : a chronology that ’ s why we took action and explored ways in which the principle of proportionality could be embedded more deeply within the regulatory and supervisory frameworks. let me start by running you briefly though the events of the past one - and - a - half years. 2 / 13 bis central bankers'speeches german finance minister wolfgang schauble and his then uk counterpart george osborne moved the ongoing debate forward substantially in april last year by noting, in a joint paper, the increasing complexity of banking regulation and pointing to the excessive burden on small institutions running straightforward business models. it is a topic we at the bundesbank also feel very strongly about. hence my decision to go public with the first set of specific proposals a little while later. that november then saw the european commission likewise table its proposals for strengthening proportionality as part of the general overhaul of eu banking regulation, which is still an ongoing process. these proposals would make major changes to the small print, and i am certain that we will be able to roll out a number of meaningful initial improvements. that said, the proposals don ’ t go far enough – which is why we thought ahead. the establishment of a german specialist working group was followed by the drafting of a bundesbank paper setting out concrete measures as well as several consultations with the german central associations. the outcome of this process is a german “ non - paper ” – that is, a discussion paper – which the federal ministry of finance put before the competent expert group of the european commission in june this year. 3 / 13 bis central bankers'speeches 5. which way? when working out this common german proposal, there were essentially two paths we could take to move

jean - claude trichet : two successes of the euro - the single monetary policy and european financial integration speech by mr jean - claude trichet, president of the european central bank, at the conference on experience with and preparations for the euro, organised by the austrian national bank ( oesterreichische nationalbank ) and the austrian federal economic chamber together with the austrian federal ministry of finance and the european commission, linz, 11 may 2006. * * * introduction ladies and gentlemen, i would like to start by thanking the oesterreichische nationalbank and its co - hosts for inviting me to speak today at your conference session entitled “ experience with and preparations for the euro ”. this year, the euro is in its eighth year, and serves as a single currency for more than 300 million citizens. i would like to address two successes of the euro which are particularly relevant to the ecb ’ s responsibilities : the single monetary policy and the progress in european financial integration, for which the euro has acted as a major catalyst. first, i will discuss some of the key successes achieved by the single monetary policy over the seven and a half years since the introduction of the euro in january 1999. above all, the single monetary policy has served to anchor longer - term inflation expectations securely at levels in line with our definition of price stability. this anchoring has facilitated the preservation of price stability, which is a prerequisite for sustainable economic growth and employment creation in the euro area. i would then like to share with you some thoughts regarding the progress in european financial integration that has been witnessed in particular since the introduction of the euro. my basic assessment is that the overall pace of integration has been impressive. and while the euro generally acted as a major catalyst for the integration of all the financial markets, integration is more advanced in those market segments that are closer to the single monetary policy – above all the money market. the single monetary policy the introduction of the euro on 1 january 1999 was an event of the greatest historical, institutional and economic significance. seven and a half years on, we can take stock of the considerable successes achieved by the euro, successes of which the european central bank ( ecb ) is justifiably proud. more importantly, when seeking to perpetuate these successes and, as the euro area enlarges, to extend them to others, we must identify the key principles on which the successes of the single monetary policy rely. to manage the new currency, the ecb