Mr. Mario Nava:

The Senator may take my last statement in various ways. I would say it was probably more of a British-style understatement. I did not want to come before the committee and claim that there will never be another crisis because I did not want to be proved wrong by what may happen and what we have not foreseen. However, it is very clear that with all the reforms we have done we looked in academic terms to the two important components of a crisis. One of these is the probability that a crisis will come, and we have put in place all possible mechanisms to reduce that probability by essentially ensuring better risk re-pricing. One way to look at the crisis is that the pricing of the risk in the banking institutions was not always correct, so we have put in place a number of regulations that allow for a more truthful risk re-pricing. However, it is important to understand that the project does not consist only of new rules on capital, concentration risk and liquidity, but also new rules on supervision and resolution, and resolution is what makes an eventual crisis have much less of an impact on taxpayers than anything else. Those are the two pillars we have addressed.

The Senator asked where I would see the next crisis coming from. That is part of the work that the Commission needs to do in the next five years. In his opening statement the Chairman asked what we could expect from the Commission in the next five years. He should not expect the same volume of regulation from the Commission in the next five years as he has seen in the past five years. That is very clear. What he should expect from the Commission in the next five years is much more reviewing of what we have done, evaluation, and calibration of all of that.

Let us be clear. The financial reform we carried out has allowed us regain financial stability. Financial stability at some moments seemed truly in peril. The work we did allowed us to regain financial stability not only on paper and by law but also in the markets. Bank capitalisation has increased massively following the new regulation. Because that was done and because we have regained financial stability, it is possible now to look at how this new financial stability and these financial reforms can contribute to the major objectives of the current Commission, which are growth and jobs. In a word, there is no growth without financial stability, but there is certainly no financial stability without growth. That is the type of thing we will look at in the next five years.