greek government bond yields due to risk aversion among international investors. to address these risks and confirm the positive outlook, we need to promptly and effectively tackle a number of major issues lying ahead, which will ultimately determine the outcome of the programme as a whole and greece ’ s ability to regain access to markets thereafter. 1st speeding up the implementation of the programme the first and most important issue refers to commitment to the programme ’ s objectives, in particular the need to speed up the implementation of the agreed reforms. the next few days will see the start of the second review, which will be looking at a number of fundamental structural reforms, with expected positive effects on economic activity. the review must be completed without any delay. this will allow these positive effects to be felt soon, thereby strengthening the prospect of growth in the greek economy at an accelerating pace from 2017 onwards. 2nd non - performing loans the second, equally serious, issue that represents a challenge for banks, the government and the bank of greece alike, refers to the restructuring of the banking system, so as to restore normal financing conditions in the private sector. strengthening the banking system and freeingup resources for financing the economy requires tackling the bulk of non - performing loans as soon as possible. effective management of non - performing loans is key to both the recovery of credit expansion and the restructuring of enterprises and sectors across the economy. to this end, the bank of greece has stepped up its efforts by promoting, in cooperation with the government, a number of major initiatives, the implementation of which needs to be accelerated and completed in the coming months. let me indicatively mention some of these initiatives : the development of a secondary market for loans ( performing or non - performing ) ; the reform of the framework for out - of - court debt settlements ; the improvement of infrastructure and expertise of the judicial framework ; 2 / 7 bis central bankers'speeches the legislative reform to ensure that existing shareholders participate in the reorganisation of companies, or otherwise immediately withdraw. in parallel, however, banks need to adopt a more active npl management policy, focusing on long - term solutions, multi - creditor workouts and restructuring of viable companies, with the participation of shareholders. during the protracted period of the crisis, the private sector has paid a high toll. uncertainty, crumbling demand, funding constraints and high indebtedness as a legacy of the past have driven many companies out of business, thousands of workers to unemployment and the volume of npls to burgeoned levels

yannis stournaras : lessons from the financial crisis and challenges for the greek banking sector speech by mr yannis stournaras, governor of the bank of greece, at a lecture organized by the international center for monetary and banking studies ( icmb ), geneva, 13 november 2018. * * * ladies and gentlemen, introduction i am honoured to be here today and have the opportunity to share my thoughts on the lessons from the international financial crisis. i would also like to touch upon greece ’ s experience over the past eight years and the key challenges for achieving a successful turnaround of the greek economy in general, and the banking sector, in particular. however, before we move on, it is crucial that i stress the importance of financial stability as a necessary condition for achieving prosperity and sustainable growth, common goals for all market participants and central bankers. i shall begin this lecture by briefly commenting on the lessons from the international financial crisis and the response of monetary and supervisory authorities. i will then outline the unfolding of the greek sovereign crisis and its impact on the domestic economy and the banking sector. subsequently, i will present the authorities ’ response, before proceeding to the core of my intervention and the lessons from the greek banking crisis. lessons from the international financial crisis the recent financial crisis has been the most severe in seventy - five years. a key question, not only for all of us in this room but also for those who study it or act as policy makers, is “ will it happen again? ” my answer is that − if and when it does happen − it will be different. first, a valuable lesson is that, while things may work well if left to the invisible hand, during times of stress that hand seems to lose its grip, in the words of ahamed liaquat in his pulitzer – award “ lords of finance ”. policy makers around the world have learned their lessons from the great depression : a financial system in distress requires active central bank intervention. central banks thus acted quickly and forcefully. they developed their toolkit with a combination of more flexible, effective and innovative measures and enormous firepower. given the success of these policies, some of these instruments may be permanently included in the new standardframework, and thus equip policy makers with the tools to engage in proper and timely action. all in all, there is no strong case for a fundamental change in the monetary policy framework. central banks are expected to continue to use the asset side of their balance