expensive than before? duisenberg : i wasn ’ t aware of that fact. question ( translation ) : mr duisenberg, over the past few days there have been a whole range of issues of government paper on the european capital market. how do you assess this wave of issuing activity? is there reason to fear an increase in interest rates at the long end and is there not a need for a harmonisation of the issuing calendar in the 11 european countries? duisenberg : we have not discussed this today in the governing council, but on one thing – on interest rates – i would like to say that it is our impression that the way in which long - term interest rates, in particular, have developed over the last few days can be interpreted as an indication that inflationary expectations of the market remain very, very subdued indeed and that there are thus no expectations in the market of a change even in the longer term. noyer : if i may add something. i suppose that you are referring to some issuing that has taken place this week, particularly in germany and france. but this was related to a calendar established well in advance in both cases. on top of that, i know, we know, that governments, treasuries have discussed together a sort of harmonisation of calendars. harmonisation is perhaps not the proper word, but they have exchanged their calendars of what they plan to issue, to avoid as far as possible having a lot of issues on the same day. so this process is going on, but for the total amount the president has just answered that there is no reason to think that there is any change. question : mr duisenberg, you stressed again the phrase : “ for the foreseeable future ”. could you explain more explicitly what it means. is it just a diplomatic phrase not to say that you want to say anything or could this foreseeable future end on 21 january 1999? duisenberg : we do not put a horizon to our future that we can see. contrary to you, i come from a very flat country where we can always see the horizon which is very far there. so it certainly does not imply any date as you indicated that will be the end of our foreseeable future. as far as we can see, now we see no tendency which would force us to change interest rates in the future, as far as we can foresee it. question ( translation ) : president duisenberg, the euro

simply operating at a lower scale, the risk of the banks, and their capital requirements, are being reduced. the first and to date largest element of the downsizing was the sale during 2010 ( at heavily discounted prices ) of the development property - related loans to the purpose - created asset management company nama. the losses that crystallised in these loan sales – larger, as i have mentioned, than expected by anyone – have sometimes been blamed by critics for destabilising the system, though i am sure that had these losses not been transparently revealed, they would quite soon have been suspected by the market ; losses on such a scale could not have been concealed for long, even if that had been desired. in the aftermath of that experience it is, perhaps, not surprising that the authorities are most reluctant to force the pace of downsizing to the point of incurring fire - sale losses. to be sure, further sales have already occurred, most notably of the polish subsidiary of allied irish bis central bankers ’ speeches bank. and steady progress is anticipated on the rest of a growing class of what are now being identified as non - core banking assets. but there cannot be fire - sale losses, as the sovereign – which would ultimately have to fund them – cannot afford them. as soon as assets can be sold outright ( as distinct from being placed in a “ bad bank ” vehicle ), then some of the banks ’ excessive borrowings from the central bank – a legacy of the years of extravagant bank reliance on footloose foreign funding – can be reduced. increasingly it seems evident that placing the continuing parts of the system on a firm footing can best be done through the involvement of new foreign owners who can bring capital, risk control and other management skills. this would effectively short - circuit the risk - reduction process now under way. with their due diligence complementing the tail - risk reduction envisaged from pcar2011, it is not unreasonable to suppose that such investors will see sufficient franchise value in the continuing banks to convince them that attractive investment opportunities exist. provided they bring credible business plans, i look forward to welcoming new owners of ireland ’ s downsized and cleaned - up banks. * * * here i think it is worth acknowledging that the ecb and eurosystem have stepped up to the mark and provided ample liquidity to the irish banking system in a period of extraordinary liquidity pressure, thereby dramatically reducing risk. of course the provision of such liquid