to deal with acute bank problems, such as closing a problem bank. when a bank needs to be closed, a difficult balance arises, between the owners'interests and the savers'interest, which are both safeguarded in law. one very current example of this dilemma in sweden is the case of custodia. both the country administrative court and finansinspektionen ( the swedish financial supervisory authority ) have made their assessments on the basis of what they should take into account, that is to say the customers'interests and the company and owners'interests respectively. however, i feel that it is very unsatisfactory that we in sweden do not have a clear legal framework that can manage this type of situation and i assume that these difficulties will quickly be repaired. crisis prevention also includes creating sufficiently strong public authorities. unfortunately, one can see that the authorities in many countries have insufficient resources, independence and competence to match the often financially strong and rich in expertise financial institutions, whose owners can moreover all too easily gain the support of politicians against the supervisory authority ’ s demands for measures. this is of course a more serious weakness in a problem situation where a lack of measures, insufficient measures or delayed measures can aggravate the crisis. another problem, although fortunately one we do not have in the nordic countries, is harassment of the management and personnel within the public authorities for the purpose of reducing their ability and willingness to take supervisory measures against wrongdoing banks. in addition, it is important to establish clear roles and areas of responsibility between public authorities within the same country, between authorities in different countries and also between the authorities and the financial institutions. i have seen that in some countries it is unclear which authority makes the decisions, or which authority has the power to decide on a particular issue, because the law is unclear or because it is not followed in practice. this lack of clarity is accentuated in a crisis situation and hampers crisis management. this can be expressed in different ways, such as poor coordination between the authorities with regard to public statements and decisions or territorial conflicts arising and special interests being favoured over general solutions. if one wishes to detect problems in good time, before they develop into a crisis, it is important that the public authorities within a country and those in different countries can coordinate and exchange information. there have been large inadequacies in this field in previous crises. this can to some extent be blamed on confidentiality regulations, and the relevance of these may be questioned

bank to reduce risks in foreign exchange trading. the banks and public authorities currently have a much better grasp of the risks in the financial sector and how these can be managed and reduced – this is probably part of the explanation why we have seen a clear decline in the number of bank crises in recent years. at the same time, the developments i have outlined above, including the creation of large financial groups and payment centres, lead to new types of risk that need to be managed. the consolidation on the part of the market must therefore be met with increased coordination on the part of regulations and public authorities. we do not need more regulation and supervision ; the challenge is that regulation and supervision must always be adapted to development and, as now, aimed at detecting and remedying the most critical vulnerabilities in the financial system. this sounds obvious, but it is not so easy to achieve in practice. commercial developments are rapid, while it always takes a little longer to adapt laws and public authorities, particularly if regulation and supervision are at the same time to be harmonised across national borders. from my work in various international forums, i know that the danish authorities in general share my views on the importance of the issues i have mentioned today and i look forward to continued cooperation with you in various ways to prevent financial crises and thus avoid having to manage them together.