companies. these responsibilities are separate from the tasks of overseeing the conduct - of - business and consumer protection aspects. among other things, this model honours the close links between the systemic stability interests of central banks and the prudential supervision of financial institutions. financial stability is always in the direct interest of central banks, because of its importance for the successful conduct of the basic central banking tasks in the fields of monetary policy and payment systems. although one should always be cautious in exporting national institutional structures to other countries, the dutch model might provide useful insights to others. the current supervisory landscape in other european union countries, as well as at the community level, is also far from being static. discussions of the appropriate institutional structures and mechanisms have intensified both at the national and european level. these debates are very healthy and demonstrate an active response by policy - makers to the development of cross - sectoral links in the financial industry, as well as to the changes brought about by the euro and financial integration. tonight, i would like to review briefly these national and european discussions. as the issues are manifold, i would like to concentrate on the role of the national central banks and the eurosystem in prudential supervision. the role of the eurosystem is rooted in the maastricht treaty, which gives it the task of contributing to prudential supervision and financial stability, while keeping the primary responsibilities in these areas at the national level. let me first turn to national developments. following the creation of the financial services authority in the united kingdom, proposals have been put forward in a number of european countries, for instance in austria, germany and ireland, to set up a single supervisory authority in charge of all financial institutions. in some cases – unlike here in the netherlands – the proposals have also included a reduced role for the central bank in prudential supervision, while increasing the responsibilities of the separate supervisory agency. in ten out of twelve euro area countries, the central bank is still either directly responsible or otherwise closely involved in the operational conduct of supervisory duties. only in luxembourg and belgium this is not the case, and in the latter a reform is being proposed that increases significantly the involvement of the central bank. as we have often said, the eurosystem strongly supports a continued involvement of national central banks in prudential supervision, although the institutional set - up of financial supervision needs to be tailored to the structure of the respective national financial system. any solution other than direct responsibility should be coupled with close

to strengthen cross - border and cross - sectoral co - operation between supervisors, to enhance convergence in supervisory practices and to reinforce collaboration between supervisory and central banking functions. the eurosystem supports these conclusions. there are clear benefits in keeping supervision close to the institutions being overseen at the national level, while financial integration requires co - operation between the relevant authorities to be stepped up. in my view, positive developments have already occurred in the implementation of these recommendations. for example, the banking supervision committee of the european system of central banks – chaired by deutsche bundesbank directorate member edgar meister – has enhanced and continues to develop its regular monitoring of the soundness of the european union banking system as a whole, as well as its analysis of structural banking and financial developments. these activities rely extensively on the close and constructive co - operation established within the committee between central banks and banking supervisory authorities. indeed, the eurosystem regards the promotion of co - operation between central banks and supervisory authorities as one of its main contributions in the field of prudential supervision. however, the full implementation of the “ brouwer recommendations ” requires additional work in order to establish an effective information exchange – both in times of calm and in times of crisis – and to achieve further convergence in supervisory practices. in addition to the financial stability considerations, the issue of supervisory co - operation also needs to be looked at from the angle of the efficiency of the financial system. indeed, increasing attention is being paid by policy - makers and market participants to the remaining inefficiencies in the financial sector and the residual obstacles to financial integration. for instance, the recent “ gyllenhammar report ” drew attention to the need for greater standardisation of supervisory compliance requirements and practices because of the cost burden on financial institutions developing cross - border businesses. these conclusions were further reinforced in the recent report by the economic and financial committee under the chairmanship of yet another compatriot of mine – kees van dijkhuizen, the dutch treasurer - general. in a similar quest for greater efficiency, considerable attention has also been paid to the community regulatory process, with emphasis on the need to achieve swift rule - making and consistent implementation in different member states. the recent institutional agreement achieved on the implementation of the “ lamfalussy procedures ” represents a major step forward in the field of securities regulation. it removes the burden of detailed and cumbersome regulation at the community level by delegating rule - making powers to a