the risk of political or public pressure on national central bank governors ( on the mistaken assumption that they should represent the interests of their own country ), and thus of a “ re - nationalisation ” of monetary policy in europe. besides, it must be said that the informative value of the minutes of individual central banks, as published hitherto, cannot be compared to that of the “ introductory remarks ” of the president of the ecb at the ecb press conferences following meetings of the governing council, in which the arguments put forward during the discussions in the ecb council are summarised. moreover, these summaries are published directly after a meeting of the council – i. e. virtually “ in real time ”. excessive transparency can make the central bank a “ hostage ” to market sentiment. in monetary policy, therefore, transparency is not synonymous with short - run predictability. central banks would then be constrained to react solely in order to meet short - term expectations. hence there are limits to central bank predictability, as monetary policy makers must have the option of taking the financial markets by surprise in the short run, to ensure that the central bank can counteract undesirable developments. in the long run, however, monetary policy must be predictable. predictability does not result in greater credibility. credibility arises in a process whereby monetary policy has to prove that it can achieve its objective of preserving price stability in a complex economic environment fraught with uncertainties. monetary policy must, therefore, work on its credibility by consistently accomplishing its stabilisation task. 3. relations of the ecb with other european institutions and fora a new supranational institution in europe also has to be assessed in terms of its relations with other institutions. particularly with the european parliament, the ecofin council and the eurogroup. relations with the european parliament and the ecofin council are governed by the ec treaty. the crucial principle is that the independence of the ecb must not be called in question. the consequence of that high degree of independence is that only the principle of ex post reporting is enshrined in the ec treaty, but not that of accountability. because the ecb has a mandate, and is independent in order to fulfil it, it has to be held accountable, and is obliged to explain and justify its decisions ex post. hence any idea of putting the “ monetary dialogue ” between the european parliament and the ecb or between the eurogroup and the

walk you through the approach. 4. the “ who ” first, let me address the “ who? ", namely the intended addressees of the relief measures. the proposal follows a three - tier approach. at the very top are the systemically important and potentially systemically risky institutions – the smallest group in terms of numbers but extremely important in terms of risk. nothing will change for these institutions. they remain subject to the full basel iii requirements, additional capital buffers, total loss absorbing capacity, and so on. the second group includes institutions which are neither large and systemically important nor small and low - risk, which is why it is not possible to make extensive simplifications for them. nonetheless, some targeted relief measures should be taken by making specific amendments to the current regulations. finally, the third group is made up of small and non - complex institutions – the banks that are most affected by the fixed costs of regulation. this group – the largest in number – would see its cost burden alleviated radically by means of a separate regulatory device : the small banking box. the burning question now, of course, is which institutions belong in which group – and particularly, which banks could be included in the small banking box. these classifications have to be balanced carefully, and this should be part of a european - level discussion. importantly, size wouldn ’ t be the only criterion. i ’ ve already said that not only do institutions in the small banking box have to be relatively small, they also must not be too complex. this is why we will need additional criteria that prevent institutions with riskier business models from being part of the simplified regime. experience has taught us, however, that there will almost never be a perfect list of criteria that covers every eventuality. this is why the final decision should always rest with supervisors. should they have serious misgivings, they can opt not to subject an institution to the simplified rules. they can also take into account the systemic risks arising from the connectedness of several small institutions – that is to say, small banks which are “ too many to fail ”. this set of options should not be a one - way street. i believe that institutions that would be considered eligible for the small banking box should also nevertheless have the option of being supervised under the more complex rules. 3 / 4 bis central bankers'speeches 5. the “ what ” that leaves the second key question : what exactly might the box look like? here we must aim right at