andreas dombret : capital requirements, the shadows and a level playing field – current challenges in financial regulation statement by dr andreas dombret, member of the executive board of the deutsche bundesbank, at the bank of france conference “ financial regulation – stability versus uniformity. a focus on non - bank actors ”, paris, 28 september 2015. * 1. * * introduction ladies and gentlemen, mesdames, messieurs, thank you for inviting me to speak at today ’ s conference. it is a great pleasure to be here at the banque de france. the bundesbank works closely together with our colleagues and friends from the banque de france and the acpr, so there is no way i would miss this prestigious event. as a banking supervisor, my focus, as you would suspect, lies mainly on the supervision and regulation of banks. much has been done in this area since the financial crisis, and maybe some of these regulatory projects could also be assigned to non - banks. 2. higher capital requirements – not only for banks? one of the main lessons from the financial crisis was that the rules governing the banking system were rather inadequate. we saw excessive risk - taking, insufficient loss absorbing capacity and banks that were “ too big to fail ” – to name just some of the problems that led to the crisis. regarding capital requirements, the most important regulatory measure was basel iii, which introduced not only stricter capital requirements but also new liquidity rules. in the eu, crd iv and crr ensure harmonised implementation of the basel iii framework across all member states. when basel iii is fully implemented in 2019, regulatory capital requirements will be significantly higher and tougher than under basel ii, and i am sure that the financial system is already today more stable than before. but will more and better capital and new liquidity rules be enough? certainly not. and therefore, besides the basel iii regime, many other regulatory projects have been launched in response to the financial crisis. two important ones are also the topic of this panel : a regulation to solve the “ too - big - to - fail ” problem and efforts to regulate the shadow banking system. at the global level, the g20 intend to approve at their summit in november a standard that global systemically important banks will have to fulfil in future regarding their capital structure. in particular, these banks will need to ensure a minimum amount of total loss - absorbing capacity, tlac for short.

now to identify areas where additional fsb recommendations are needed and where existing recommendations should be fleshed out. we have to drive this reform agenda with all our efforts. 4. conclusion : international cooperation as precondition for effective regulation ladies and gentlemen, let me conclude my remarks with something that is very important to me. any regulatory project needs international cooperation. if we do not coordinate our approaches towards regulation, we will create a fragmented financial system with vast opportunities for regulatory arbitrage. when all is said and done, we are all pursuing the same objective : a stable financial system – certainly at the national level, but it is equally important at the global level. as regulators, we therefore must work together in an effort to avoid any form of fragmentation of the regulatory space. the issue of derivatives oversight is just one example where international cooperation is essential. thank you for your attention – merci de votre attention. bis central bankers ’ speeches