area concluded that credit standards eased considerably for loans to enterprises and housing loans, and loan demand increased across all categories, thereby continuing to support loan growth. as far as the ecb ’ s qe programme is concerned, ecb holdings amount to €1. 96 trillion under the public sector purchase programme ( pspp ), while total purchases under the asset purchase programme ( app ) amount to €2. 39 trillion, and the app is expected by the majority of economists to come to a close by year - end. the pace of app purchases was reduced to €60 billion per month as of april 2017 ( from €80 billion previously ) and to €30 billion per month as of january 2018. 2. emu reform and the risks from the lack of progress 2. 1 emu reform i would now like to discuss the concerns about the emu setup, especially in the aftermath of the euro area debt crisis. the crisis brought to the surface major flaws in the euro area ’ s functioning, which had been building up over time and did not emerge overnight. the eurozone remains a job half - done and, without a doubt, the completion of the emu architecture could further facilitate and motivate member state reforms in view of euro area accession. on the positive side, one has to mention the establishment of a permanent rescue fund, the european stability mechanism, which provides financial assistance to euro area countries experiencing, or threatened by, severe financing problems, which can no longer borrow money on financial markets as a result. a banking union is on track to be completed, ensuring centralised supervision of systemically significant credit institutions subject to a single rulebook applicable across the european union and also ensuring centralised resolution in the event of failure of such a credit institution. a capital markets union is also under way, creating a new financial system that is less dependent on bank financing with the potential to increase risk - sharing via the private sector and address economic shocks. although the emu is now stronger, it is not yet fully shock - proof. table 1 elements to complete an economic and monetary union source : european commission. i will stay a bit longer on the banking union which is of direct interest also to noneuro area eu member states. it is currently still lacking key components that would ensure risk - sharing across the euro area and break the vicious circle between banks and sovereigns. a reflection paper by the european commission on deepening the economic and monetary union proposed concrete steps that could be taken by the time

and one european, linked respectively to the weaknesses of some countries ’ economies and public finances ( sustainability risk ), and to the incompleteness of european construction and the attendant fears of a break - up of the monetary union ( redenomination risk ). europe ’ s response to the sovereign debt crisis has consequently been two - pronged : on the one hand, individual countries have pledged to adopt prudent budgetary policies and structural reforms to support competiveness ; on the other, a far - reaching reform of eu economic governance has been undertaken. the definition and implementation of this response was not smooth, let alone optimal. but the constraints were significant ─ first and foremost, the lack of trust among member states, partly justified by the episodes which ignited the crisis ( fiscal misreporting and failures in financial supervision ). moreover, there was a lot of ground to be covered in a very short term. europe had no tools with which to manage a sovereign crisis and the legal basis for providing financial support to countries in distress had to be defined. international treaties needed to be drafted and ratified, also to strengthen peer oversight on national fiscal policies and structural reforms. further integration of financial markets was necessary to increase the resilience of the area to asymmetric shocks : the banking union and the on - going project of the capital market union are both far reaching reforms, affecting in depth the institutional fabric of member countries. the ecb governing council, by providing a series of conventional and unconventional monetary policy measures to fulfil its price stability mandate, ensured accommodative financial conditions that mitigated the fall in aggregate demand and helped to “ buy ” the considerable time needed to implement this strategy, while countering market uncertainties that could undermine its implementation. the european strategy to respond to the crisis has brought overall a stabilization of financial conditions and an easing of tensions in sovereign debt markets, even if we are still in deep and at times unknown waters. but, obviously, bis central bankers ’ speeches monetary policy cannot guarantee strong and lasting growth on its own, it cannot be a substitute for the needed reforms, it can only provide favourable conditions to speed the process up and absorb its short - term costs. a successful effort requires, once again, action at both the national and the european level. lacking a common fiscal capacity, demand in the euro area must draw support from a more convinced use of the available fiscal space. in particular, this implies a substantial, and symmetric, respect