. the ecb monitors and assesses risks to financial stability, because turbulence in the financial system may weaken the ecb ’ s ability to maintain price stability — the two are functionally connected. and since the crisis, the ecb also plays a role in maintaining financial stability through its competences in banking supervision and in macroprudential policy. but going back in time, the relationship between the different functions of central banks have generated quasi - existential questions. what a central bank is, can be defined by what it does. 1 and the “ what it does ” part mostly revolves around the question of whether a central bank cares about two types of stability. the first is monetary stability : the creation of a monetary regime that can ensure price stability. the second is financial stability which, when central banking was born, was essentially the same as “ bank stability ”. so, throughout history, the most popular definitions of “ central bank ” have revolved around their role in ensuring monetary stability, financial stability or both. 1 / 10 bis central bankers'speeches one of the founding ecb board members, tommaso padoa schioppa, believed that both aspects mattered. to him, a central bank was defined by its role in safeguarding both price stability and financial stability. as for financial stability, he argued that historically, a central bank ’ s role in this realm was rooted in its dna. first, the central bank was a bank. it was also monopolist in the provision of ultimate liquidity. and last but not least, it was a bankers ’ bank. it played a role in settling payments between banks. 2 and a well - functioning interbank market plays an important role for financial stability. and he was of course not the only one to see the role that central banks played in financial stability as essential. from walter bagehot ’ s book “ lombard street ” all the way to the work of charles goodhart, one function has been singled out to identify central banks : their role as lenders of last resort. take the bank of england as an example. even after becoming a monopolistic issuer of notes, it still operated as a profit - maximizing bank. charles goodhart argues that it did not become a true central bank until the second half of the 19th century, once it let go of profit - maximizing and took on the role of lender of last resort. 3 and there is a similar story about the emergence of central banks

the recent property market contraction, i think we will be able to weather the situation through appropriate policy responses given the overall soundness of domestic financial institutions. moreover, while there is much concern about the trade account deficit, this is mainly attributable to the increase in imports due to the surge in global commodity prices. in fact, korea's exports reached an all - time high last year. despite sluggish semiconductor exports due to the fall in unit prices, exports of other major items continued to grow last year. given this, korea's trade account is expected to improve rapidly should external conditions recover. while it is possible that the fragmentation of international trade and high interest rates could further weigh on the korean economy going forward, from a different perspective, they could also serve as an opportunity for us to address the structural issues that have been left untackled. in the course of responding to the restructuring of global supply chains, we need to reduce our heavy dependence on the chinese economy through, namely, market diversification. the high interest rate environment could also be a starting point for us to alleviate the high level of household indebtedness while improving the debt structure. the korean economy has been repeatedly seeing property - related finance emerge as a structural vulnerability, albeit in different forms. we should take this opportunity to bring good out of evil by fundamentally resolving the related issues. toward this goal, we will also need to look into the reasons why macroprudential regulations did not operate effectively as preemptive measures. 2 / 4 bis - central bankers'speeches the german philosopher hegel once said, " we learn from history that we do not learn from history. " let us not repeat the same mistake as pointed out by hegel. it is true that we are facing hardship both domestically and internationally. however, i believe we can produce a better outcome based on our actions. we have it in our dna to effectively overcome any crisis. we must turn these challenges into opportunities. my dear colleagues, in times of need, people look to experienced professionals. in flight, if visibility is poor due to worsening weather conditions and if the runway is so narrow that a soft landing seems unlikely, an experienced and reliable pilot will be needed more than ever. with a wealth of experience and a balanced perspective, the bank of korea should work hard to become one of the most trusted pilots to help our economy make a soft landing. to this end, it is necessary to more accurately judge and predict