estimate the total losses over the period 2007 - 2010 to be around usd 650 bn. write - downs on securities have so far amounted to over usd 200 billion. banks have provisioned and written off over usd 150 bn of their loan exposure. therefore we estimate further potential losses to be a little below usd 300 bn. half of the losses worldwide are estimated to be borne by us banks, a quarter by euro area banks, and another quarter by banks located in switzerland and the uk. • if we want to re - establish economic and financial stability, we need to develop the lessons from the crisis. to this end it is important to recall what triggered the crisis. low inflation rates and robust growth in the context of global imbalances, as well as abundant liquidity, were the main drivers at the macroeconomic level. at the level of the financial system it was regulatory arbitrage, deterioration in credit standards and increased reliance of banks to fund their assets in short - term markets. • thus, the crisis is a consequence of a combination of failures both in financial markets and on the part of regulatory authorities. despite market failure having been one factor, we must not forget that market participants have simply behaved in line with the incentives provided by regulatory authorities. in this respect, improved regulation and oversight of financial markets will be crucial to ensure economic and financial stability. in particular, sound balance sheets, solid risk management and transparent and robust business models are key in strengthening the financial soundness of banks and their resilience to shocks. the first line of defence of financial stability is with market participants. to provide for the right incentives, market participants must be liable for their actions. this is an essential condition for sustainable economic growth and financial stability. • at the same time, we need to develop the financial system further. to enhance transparency, we need to reduce the complexity of the financial system, institutions and products. • the crisis has painfully shown that ensuring solvency of individual financial institutions does not ensure stability of the financial system as a whole. when funding markets shut down, both solvent and insolvent institutions are hit. neglecting such wider systemic issues has been one of the glaring inefficiencies of prudential regulation. too great an emphasis has been placed on micro - prudential rather than macro - prudential aspects. initiatives are now being taken to close the gap that exists in this respect, especially in europe, where cross - border supervision is still a challenge. where do we

employment by the members of the ecb ’ s executive board, governing council and supervisory board. 5 this new initiative complements the single code of conduct for highlevel ecb officials and demonstrates our strong commitment to integrity and good governance. it will facilitate public scrutiny, thereby enhancing trust in the ecb and ultimately in its decisions. this leads me on to my final point on good working relations requiring trust. trust, on the one hand, that criticism of the ecb reflects concerns raised by european citizens on matters that fall within the ecb ’ s mandate. and trust, on the other hand, that the ecb listens and takes such criticism into account. this trust forms the basis for our constructive dialogue, both formal and informal, and ensures that our relationship delivers. and so it does : in response to your call for the ecb to reflect on ways of reducing the reporting burden associated with the collection of statistical and prudential data – an activity which costs the banking sector several billion euro each year – we proposed practical solutions in cooperation with other european authorities and the banking industry, while improving the quality of the data collected. 6 at the very beginning of my term of office, you invited the ecb – in full respect of its mandate and independence – to reflect on how its policies could support the green transition. the ecb ’ s governing council has now decided that, from 2021, the eurosystem will accept bonds with coupons linked to certain sustainable performance targets as collateral for credit operations and outright purchases for monetary policy purposes, provided that they comply with all other eligibility criteria. building on these three criteria, we should continue to do what we have been doing all along : ensuring that our accountability practices remain commensurate by letting them evolve in a flexible manner and by adapting them in line with the demands for scrutiny from european citizens. and because we can only make improvements if we are aware of people ’ s expectations and concerns in relation to the ecb and its policies, we are inviting everyone in the euro area to share their ideas and comments through the ecb listens portal on our website. conclusion let me conclude. our regular exchanges are crucial in explaining the ecb ’ s actions to people across europe and to you as their representatives. this is even truer in testing times when the people of europe expect the eu to rise to the challenge. a recent survey commissioned by this parliament shows that more than two - thirds of europeans would like to see the eu have more