Mr. Gabriel Makhlouf:

The most important thing to say about the banks is probably that they are much more resilient than they were ten years ago. This is a combination of the work the Central Bank and the individual banks have been doing and the fact that the world has looked to change rules and regulations to strengthen the financial system. They are, therefore, in a better place. On the other hand, it is absolutely the case that we need to build more resilience. We were just talking about one particular issue. Our banks are still holding greater levels of non-performing loans than many other banks internationally. We want to build the buffers about which I spoke, namely, the counter-cyclical buffer about which I made an announcement yesterday, the other systemically important institution buffer and, in time, once the legislation is introduced and available, the systemic risk buffer. We think all those buffers will be required to ensure that the banks have enough capital to be adequately capitalised and to be as resilient as possible. We are in a much better place than we were but we need to do more to make sure that we are protected from future shocks.

In terms of the Irish, European and world economies, what I see over the next few years are risks - probably more risks than opportunities, if I can put it that way. The Irish economy is operating at near full capacity. We spoke about that yesterday. The European economy is not operating at the level we would like it to operate. The same applies to the world as a whole. Ireland is operating better relatively speaking than the rest of Europe and the world. We know that one of the reasons for the slowdown in global growth is the uncertainty created by the trade wars. There is a big risk, which people have been talking about, that will start to manifest itself next week. This is the gradual breakdown in the international rules-based order. I am referring specifically to the fact that next week, the disputes resolution panel in the World Trade Organization will cease to be able to function because it will no longer have any judges to be able to make decisions. This is a very unwelcome development. Ireland and most countries in the world rely on a rules-based order to work so I see that as a big risk. We are all hoping that the trade wars, particularly the one between China and the United States, are resolved.

The message I take from what is happening around the world is that we need to build resilience. The important thing is that the world around us is changing all the time. We are seeing it in demography, technology and in issues like climate change. There are risks around. From my perspective and that of the Central Bank, we need to look very carefully at managing that.