they at their very best slow down the build - up of stability risks within the financial system. this has several important policy implications. for one, despite of the limitations i sketched, we should remain committed to full implementation of the international reform agenda. limitations in scope and impact cannot be an argument to deregulate. but on top of this, we should continue to work on structural challenges within the economy and its financial system. importantly, we should also continue to think about the implications for the overall macroeconomic policy mix. the observation that macroprudential policies cannot be fully relied upon to contain systemic risks would also have to be taken into account in the conduct of monetary and fiscal policy. to be clear : it should not have an impact on the mandate or direction of monetary policy, which would continue to be fully geared towards price stability. however, financial stability would have to be a relevant factor to take into account within the design and the proportionality of policy measures. obviously, these are complex observations that require further analysis. i look forward to discuss these and related matters in our quest for further operationalization of effective macroprudential policies.

those objectives. bis central bankers ’ speeches second, the system of multilateral surveillance did not prevent pronounced macroeconomic imbalances : productivity differentials, current account deficits, excessive private sector borrowing. in 2009, the deficit on the current account of the balance of payments amounted to 10 per cent in greece and 7. 5 per cent in portugal. in ireland, portugal and spain, the financial debt of households and firms amounted to between one and a half and two times the euro - area average of 170 per cent of gdp ( in italy it was equal to 130 per cent ). in ireland, the largest national banks had balance - sheet assets totalling more than five times gdp ; the collapse of property prices and the recession caused them huge losses. imbalances of this kind ultimately have repercussions on the public finances, even in countries where these are initially in order. in the irish case, the public resources spent on supporting the banks came to more than 20 per cent of gdp. last autumn the european commission and the working group led by european council president herman van rompuy put forward proposals concerning both aspects : how to make the stability and growth pact more cogent ; how to extend surveillance to macroeconomic developments. it was proposed that the pact be strengthened for the prevention of fiscal imbalances, by intensifying monitoring and introducing timely monetary sanctions, and for their adjustment, by providing in particular for the possibility of initiating the excessive - deficit procedure not only when the deficit exceeds 3 per cent of gdp but also when the reduction in the debt towards the 60 per cent ceiling is deemed unsatisfactory. in the macroeconomic field, a system of monitoring imbalances having potentially significant implications for the euro area ’ s financial stability was envisaged, with quantitative indicators and critical thresholds based on which the european council may issue recommendations to the country concerned and, in the most serious cases, apply financial sanctions. lastly, it was recommended that the efsf be replaced from 2013 onwards by a permanent mechanism of financial support, the european stability mechanism ( esm ). only the countries considered to be solvent would have access to financing, which would be conditional in any case on their adopting serious adjustment plans ; the others would be asked to negotiate a debt restructuring plan with private creditors by which to return to a situation of solvency. on 15 march the eu finance ministers agreed a “ general approach ” that fully implements the recommendations of the commission and of the van rompuy