, of course, first the responsibility of monetary policy, which has been assigned to the eurosystem since january 1. incidentally, monetary policy is european commission, economic forecasts spring 1999. also making the most valuable contribution to growth and employment by ensuring price stability. to enable the european system of central banks ( escb ) to fulfil its task, its independence was enshrined in the maastricht treaty ( article 107 ). neither the ecb, nor a national central bank, nor any member of their decision - making bodies is allowed to take instructions from any government. similarly, the governments of the member states shall not seek to exert any influence on monetary policy. in the last months, this second part of the article of independence was neglected by some parties. the signatories of the maastricht treaty have, however, and rightly so, acknowledged that a “ depoliticised ” money can only be brought about, if all policy areas duly respect the independence of the central bank. at the beginning of this month, the governing council of the ecb - fully independently and with total responsibility for price stability - lowered the interest rate for the main refinancing operations from 3. 0 % to 2. 5 %. this decision was in line with the two pillars of its strategy and was taken with a view to the future. it was generally welcomed. however, the ecb governing council made it clear that those responsible for other policy areas are now even more obliged to take the necessary steps. iii the international role that the euro will play in the future will be determined particularly by the policies pursued in the euro countries. it will hinge crucially on the euro ’ s stability and the success of emu and on the markets ’ confidence in the new currency. i should like to stress at this juncture that it was never intended to establish the euro as a “ counterweight ” to the dollar - although some commentators saw it like that. the relationship of the european currencies to the us dollar had previously depended, in particular, on the size and openness of the respective economic area, the breadth and depth of the financial market, and the preferences of international investors. in the case of the d - mark it was certainly the profound confidence of market participants in the stability of the german currency that established is as the second most important reserve and investment currency after the us dollar. as far as the size and openness of the

bank recovery and resolution directive spells out clear rules on who has to bear the costs when a bank fails. in a nutshell : bail - out is out and bail - in is in. in future, shareholders and creditors will be first in line when it comes to bearing losses ; taxpayers will be last in line. this directive will be implemented in germany in early 2015 ; the latest possible date for implementation in other countries is 2016. also from 2016 onwards, european banking supervision will be supplemented with a european resolution mechanism for banks. from then on, the banking union will rest on two pillars and provide a stable framework for european financial markets. 4. what about the banks? what does all that mean for the banks? in essence, regulators and supervisors are working towards strengthening the principles of a market economy. naturally, this puts more weight on the shoulders of market participants, that is, the banks. in future, there will be no public lifeguard standing by to bail banks out when things go wrong. failure has become a real possibility and banks have to acknowledge that. they should have an interest in safeguarding their stability and strengthening their profitability. regarding the stability of banks, the comprehensive assessment provided a deep insight into the state of the european system. so let us take a closer look at the german banks that were subjected to that assessment. all in all, german banks did rather well. of the 25 german banks that were examined, there was only one “ technical ” failure, since the bank in question has already remedied its capital shortfall. over all, it could be concluded that german banks are stable enough from a capital point of view to cope with severe economic stress. but again, no bank should give in to complacency. and neither should supervisors. we should, for instance, be aware that the comprehensive assessment focused on risk - weighted capital ratios. markets and supervisors, however, also cast an eye on unweighted capital ratios. and with regard to these leverage ratios, german banks are below average compared to other euro - area countries. thus, there is ample room to catch - up and improve stability even further. nevertheless, while stability is necessary for a bank, it is not sufficient. banks have to be profitable as well. and in this regard, too, german banks need to catch up. their return on assets and their return on equity are also relatively low compared to other euro - area countries. a recent study even comes to the conclusion that only 6 %