climate - related damages are expected to go up due to an increase in the frequency and intensity of severe weather events. this means that insurance premiums may have to go up and that insurers may need to hold more capital, as they hold capital for severe events. we also found that models currently being used by insurers to predict damages do not adequately take climate change trends into account. in terms of the energy transition, we warned of risks stemming from new sustainability legislation for offices. the dutch government requires office buildings to have a minimum energy label of c as of 2023. this means that all office buildings that don ’ t meet this requirement now, have five years to reach the required level, or their cash flows will dry up. our financial sector finances large chunks of the real estate sector. when cash flows dry up, that will jeopardize the value of these loans. so how big is the problem? we found that on average 46 % of bank loans to commercial real estate parties, has an energy label of less than c, representing some 6 bn euros. these loans run serious risks the coming years, and banks need to manage this risk. in doing so, by the way, they will discover, indeed they of course already have, that there are also ample and sound business opportunities to help their clients meet these legislative deadlines, thus creating a win win situation for business and climate. but that ’ s not all. as a follow up to this work, we are right now developing both physical and transition related stress tests. and we hope to present the results of the physical stress test in the coming few months. we ’ ve also done some work on the broader question of sustainable finance. about a year ago we published a report on responsible investing in the pension sector. this was based on a requirement in dutch law for pension funds to be transparent as to whether and how pension funds take esg factors into account. we assessed whether indeed all pension funds included their esg investment policy in their annual report, and we shared the good practices that we saw. last but not least, using our convening power, we ’ ve founded a national platform for sustainable finance, which brings together our government, supervisors and industry representatives from the entire financial sector. the aim of this platform is to promote and encourage a dialogue on sustainable finance in the financial sector. in addition, the platform also allows for financial institutions to form cross - sectoral working groups to tackle existing problems. one

us housing market is still weak. therefore, the economic outlook remains uncertain. concluding remarks 15. the international response to the credit crisis, coordinated by the financial stability forum, is a crucial first step towards restoring financial stability. but i am sure that, at some point, our incentives will be tested again. therefore, we need creative minds that help us to identify new imbalances at an early stage. these are great times for financial economists. traditional macroeconomic analysis and monetary economics have been extended by a variety of financial stability issues, with both micro and macro dimensions. i am confident that this conference will contribute to this interesting and rapidly developing field.