should avoid unnecessary destruction of value. 1 / 4 bis - central bankers'speeches in view of these considerations, the post - crisis resolution frameworks seek to combine the preservation of systemic stability and the continuity of financial services with market discipline and the avoidance of taxpayer - funded bailouts of failed banks. this is also the main idea behind the bank recovery and resolution directive. in europe, the adoption of the bank recovery and resolution directive, which introduced a harmonised set of rules for the resolution of banks across the union, was followed two months later by the adoption of a very closely related instrument specifically aimed at the euro area, namely, a regulation establishing the second pillar of the euro area banking union, the single resolution mechanism. the first pillar of the banking union, the single supervisory mechanism, contributes significantly to enhancing bank resilience by applying very high prudential standards in a consistent manner to all supervised institutions operating in the euro area and by reducing risks to the system. however, despite enhanced regulation and supervision, bank failures will inevitably occur. the responsibility for preparing for and dealing with this eventuality lies with the second pillar, the single resolution mechanism. as we all know, this is an integrated, multi - level administrative mechanism, comprising a central component, the single resolution board based in brussels, and the national resolution authorities of the member states of the banking union ( including, by the way, the bank of greece ). the single resolution mechanism is responsible for both resolution planning and the actual implementation of resolution measures once a bank is deemed to be failing or likely to fail. to finance its resolution actions, it has access to a single resolution fund, which is pre - funded with contributions from the banking industry. the creation of the single resolution mechanism was a bold and decisive step towards the integration of european banking markets. subsequent events, including the handling of the failures of banco popular and sberbank, have confirmed its value. at the same time, through the efforts of the single resolution mechanism, banks in the union have become more resolvable and thus safer. not only have they built up their loss - absorbing capacity, but they have also developed their skills in all aspects of resolvability. moreover, the single resolution fund is now fully funded and mutualised, having reached its target amount. but this does not mean that all is well and that we should rest on our laurels. as last year's unfortunate events in the us, the uk and switzerland have shown, there is

no room for complacency. instead, authorities should remain vigilant and draw on the lessons learned. as the financial stability board concluded in its review, the bank failures of 2023 underscored the strengths of the international resolution framework. however, several issues were identified on which work needs to be done. let me highlight a few : first, the us cases in particular showed that the framework should be flexible enough to allow authorities to take resolution actions to deal with the failure of medium - sized or even small banks. the reality is that the bank recovery and resolution framework was designed primarily to deal with the failure of significant institutions. while the use of insolvency proceedings may be a credible solution for small or medium - sized banks, 2 / 4 bis - central bankers'speeches there may be cases, as seen in the us, where the prospect or experience of depositors bearing losses may lead to runs by unsecured depositors on other banks perceived to be similar to the troubled bank, creating a systemic problem. second, we need to maintain flexibility in the use of resolution strategies to deal with different scenarios, including liquidity crises. in this context, we may need to consider whether transfer tools or a combination of strategies might be more appropriate than the bail - in tool. third, liquidity in resolution is of paramount importance. authorities should be prepared to provide liquidity, as was the case in the us and switzerland. on the other hand, resolution and competent authorities should work with banks to ensure that the latter can quickly mobilise collateral when needed. i expect that these issues will be analysed in detail today. as far as europe is concerned, despite the progress made in the field of resolution on the basis of the two innovative instruments adopted ten years ago, the bank recovery and resolution directive and the single resolution mechanism regulation, the actual operation of the european resolution framework has revealed certain shortcomings and outstanding issues that need to be addressed. fortunately, the proposals for reform of the european crisis management and deposit insurance framework tabled by the european commission in april 2023 point in the right direction. this legislative package, which is currently under discussion in the european parliament and the council, promises to introduce many necessary improvements. in particular, the commission's proposals : extend the resolution framework to medium or small banks, facilitating the financing of the sale of selected assets and liabilities through mrel funds and, in exceptional cases, through the deposit guarantee schemes ; propose that all