profit and loss account for 2003 closed with a loss of €842 million, partly as a result of substantial value adjustments to loans. in 2004 it showed a profit of €282 million. against this background of uncertainty, abn amro and bpl were repeatedly urged to reach an agreement that would ensure the sound and prudent management of banca antonveneta. contacts between the two parties in the early months of 2005 nonetheless failed to produce mutually acceptable solutions regarding either the governance of the bank or commercial agreements ; on the contrary they led to an acceleration of plans by both parties to undertake transactions involving the capital of banca antonveneta. 3 / 14 2. 2 bpl ’ s application to increase its shareholding to 14. 9 per cent of banca antonveneta ’ s capital on 4 february bpl gave the bank of italy prior notification of a plan to acquire 14. 9 per cent of antonveneta ’ s capital. a formal application was sent on 11 february ; the bank of italy granted authorization on 14 february, ten days after the notification. the capital needed to ensure the sustainability of the transaction was to come from an existing surplus of own funds and the forthcoming issue of a €300 million subordinated loan for which authorization had already been obtained. the plan drawn up by bpl to strengthen its capital base by issuing additional instruments was designed to maintain a high solvency ratio even after the investment. since the issue of the capital instruments announced by bpl would take a few weeks, in the authorization measure the bank was invited to proceed gradually in acquiring the shareholdings ; the document contained a further request that additional measures to strengthen capital be scheduled for the end of 2005 to take account of the effects of the application of the new international accounting standards. in the weeks after 14 february technical meetings were held to discuss the proposed issue of capital instruments with innovative features ; the bank of italy requested additional documentation and after careful examination demanded changes to the transaction ; consequently the preparation of the issue took longer than initially planned. 2. 3 abn amro ’ s applications for authorization on 15 march 2005 abn amro informed the bank of italy, in its prior notification, that it was interested in acquiring control of banca antonveneta through a complete - acquisition tender offer. abn amro sent the official request for authorization, accompanied by the prescribed documentation, to the bank of italy on 30 march. in compliance with the requirements of european legislation and the supervisory instructions,

lower by about half a percentage point in 2015 – 17. of course, a very accommodative monetary policy for a protracted period involves risks that need to be monitored carefully. the report considers the impact of low interest rates on investors ’ portfolio choices, noting the rising importance of private equity, hedge funds and real estate investment funds. this analysis highlights that too - low - for - too - long interest rates may spur asset price bubbles and may also stimulate short - termism among investors, i. e. by favouring companies that offer cash - like returns at the expenses of companies that focus on longer - term investment projects. in this respect, let me just observe that portfolio rebalancing that would encourage a higher degree of risk taking is one of the intended channels of transmission of non - standard monetary policies and that currently there are no indications of a generalised overvaluation of financial or real assets in advanced countries. should excessive risks emerge, targeted macroprudential policies can be used as appropriate. clearly, monetary policy is not the solution to structural problems ( and, as we often say, cannot be the “ only game in town ” ). but i do believe that an expansionary monetary stance creates more favourable conditions to implementing structural reforms : it stimulates aggregate demand and may reduce the possible short - term macroeconomic costs of reforms while helping maintain the necessary political drive and foster consensus regarding their adoption. in the same vein, monetary policy cannot be left alone in the effort to support the economic recovery ; it must be complemented by an appropriate use of available fiscal space, with appropriately targeted, growth - enhancing measures, such as investment in infrastructure. on structural reforms, let me also point out that, while increased competition in product markets and more flexibility in labour markets remain important for the enhancing of an economy ’ s ability to withstand shocks and recover quickly, when designing reforms, it becomes critical to take into account issues such as those raised in the debate about secular stagnation, as well as the structural trends triggered by innovation. for example, it is essential to consider the impact of the digital revolution on both labour demand, which has raised fears of a re - emergence of keynes ’ technological unemployment, and income distribution, as highlighted by james meade already in 1964. this puts a premium on measures to favour investment in education, life - long learning, training and active labour market policies. moving on to the fundamental issue of productivity, the report carries out a very detailed analysis of