overseeing payment systems ( domestically and cross border operating ). in this respect the eurosystem runs the target 2 system for both cross border and within the country transfers of funds in euro. thus, ensuring the real time execution of the orders, as the transfers are in central bank money. privately run payment system do not provide to the same extend this guarantee. in addition, it was decided that the eurosystem will develop the target 2 security settlements system ( the ts2 ) operating on a centralized platform, thus providing additional guarantee that the movement of cash and titles will automatically match. this removes the counterparty risk of not fulfilling contractual obligations. the smooth functioning of cross border payments and settlement systems are essential for preserving the stability of the financial system and for the timely execution of individual banks ’ commitments. these services provided by central banks give an important advantage to them over fsas, especially in times of crisis. second, the experience of the turmoil confirmed the need for strengthening in general the interplay between the financial stability assessment of central banks and the prudential oversight of individual financial institutions. this stems from the fact that the turmoil has been characterised by a combination of disruptions in the functioning of some markets, including money markets, and concerns over the state of health of individual financial institutions. in practice, the supervision of individual institutions should benefit from the outcome of the financial stability assessment of central banks, which in turn should rely also on input coming from supervisors. the close linkage between the two functions is also recognised in the reform projects in the uk and the us where the envisaged reinforcement of the financial stability role of the central bank is always accompanied by the possibility for the latter to have direct access to supervisory information. third, the independence and expertise argument highlights the quality of the contributions central banks can make to financial stability, also benefiting from their independence. allow me at this point to say a few words about the role of the ecb. first, without the liquidity injection of almost €1 trillion by the ecb the euro area banking system could not have overcome the financial crisis. second, i would like to underline the important role that the vice - president of the ecb, mr lucas papademos – as responsible for financial stability in the ecb – has played for the preparation of the eu banking support package framework. the recognition also by the eu governments of the crucial role of the ecb during the present financial crisis, in addition to the growing calls for a eu banking

it today, is the result of a long process. the world ’ s first coins were produced in lydia over 2500 years ago. they were made from electrum, an alloy, and a roaring lion head was engraved on one side, a symbol of the ruling dynasty. this innovation quickly spread to the city - states of ancient greece. during the classical period, greek coinage reached an exceptional technical and artistic level. as anyone who has visited the numismatic collection at the bank of greece knows that money has evolved to meet society ’ s needs. as economic activity increased, it became apparent that money supply needed to expand beyond the limits of holding precious metals. centuries later, with the circulation of paper money, minting of metal 1 / 6 bis central bankers'speeches coins was restricted to lower values. in classical economic theory, money fulfils three functions. first, it is a means of payment and therefore has a key role in all financial transactions. second, it forms a unit of account. third, it is a store of value. people will only accept money as a means of payment if they believe it can be used again in the future. for all these to work, money assumes a broad trust in the issuing institution. the first central bank was founded to build additional trust in the currency, since the issuance by private entities led to an unstable system. hence, the role of the central bank is related to trust. there are three types of money in the economy : a ) physical cash, i. e. banknotes and coins. banknotes is the form of central bank money that can be held by the general public. b ) the second is electronically recorded deposit account liabilities on the ledgers of commercial banks. c ) the third is reserves, that is, deposits of commercial banks with the central bank. cash nowadays is displaced in many ways and the “ demonetization ” of transactions has become a commonplace. however, the question arises : will there be an increased need for cash in the near future? the answer is clearly positive. for, here is the paradox of the coming “ cashless economy ”. according to the ecb, in 2016 around 79 % of all payments at points of sale ( pos ) in europe were made with cash1. therefore, although nowadays most money has been already digitized, cash is still world ’ s quintessential means of payment. cash still remains an important and a very popular component of money supply. digital cu