above the minimum reserve requirements over monthly periods of time. this will allow the banking system to absorb liquidity shocks easily. the volatility of money market rates will, as a consequence, be reduced. also, fine tuning operations will not have to be used frequently, which will mean that markets are less affected by central bank interventions than they would otherwise be. the second objective of the minimum reserve system is to enlarge the demand for central bank money, so as to enlarge the liquidity deficit of the banking system vis - a - vis the european system of central banks. this will safeguard the role of the european system of central banks as a key provider of liquidity to the banking system. in the minimum reserve system of the ecb, the reserve ratio will be rather small and reserve requirements will be fully remunerated. the reserve ratio will be set at between 1. 5 % and 2. 5 % and will be applied to the deposits, debt securities and money market paper issued by credit institutions, except for residual maturities above two years. reserve holdings will be remunerated up to the required reserve level, at the rate of the escb ’ s main refinancing operation ( as averaged over a month ). it may be argued that a less than full remuneration of minimum reserves would increase the interest rate elasticity of central bank money demand. this notwithstanding, the european central bank has decided in favour of a full remuneration of minimum reserves in order to avoid the potential distortions to fair and efficient markets that a less than full remuneration could have implied. as a result, the minimum reserve system is unlikely to lead to any delocation of certain parts of the reserve base, hence of savings. finally, it may also be useful to note that the european central bank has also decided not to exempt any credit institution of the euro area from the minimum reserve system. 4. conclusion i am confident that the policy of the ecb has always been, and will continue to be, guided by the principle of equal treatment, the desire to foster the development of financial markets in the euro area and the need to avoid undue shifts in economic activity. this will also contribute to providing an adequate environment for an efficient allocation of savings in the euro area.

beginning of 1995, she accepted all obligations of the maastricht treaty, including the plan for the economic and monetary union. the painful financial instability of the late 1980s and early 1990s was probably one main reason why the euro enjoyed relatively strong appeal among finnish politicians and the population at large as well. after the banking crisis of the early 1990s, financial supervision was reorganized in finland in 1993. financial supervision was made a part of the bank of finland, but as an independent institution with its own decision - making bodies. later, also insurance supervision was merged to this supervision authority which operates in connection to the bank of finland. bis central bankers ’ speeches the newly re - established financial stability of the mid - 1990 ’ s allowed finland to join the european exchange rate mechanism ( erm ) in october 1996. finland was then among the first group of countries to adopt the euro in 1999. the governor of the bank of finland, dr sirkka hamalainen, became one of the members of the ecb ’ s first executive board, and actually its first female member. now a part of the eurosystem, the bank of finland continues in its role as the monetary authority and the bankers ’ bank in finland. nevertheless, it has streamlined its operational functions, while investing in more than previously in its economic research and communications activities. the bank now has 390 employees ( at mid - 2014 ) and 580 when the financial supervision authority is included. the bank of finland has traditionally invested a significant amount of resources in economic research. this continues today. as part of its profile within the eurosystem, the bank of finland has also developed a research concentration on the economic and financial developments in russia, which is again a very important trading partner for finland. according to recent polls, the bank of finland is now among the top three most trusted institutions in the country. the current governor of the bank, since 2004, is mr. erkki liikanen, who has previously served as finland ’ s finance minister and a member of the european commission. bis central bankers ’ speeches