Today I see a banking sector that has weathered the storm, and has emerged stronger. Smaller perhaps, but more resilient, more focused and better capitalized. A banking sector with one of the lowest NPL ratios on average in the euro area. And that leaves the Dutch banking sector in a very good position to seize new opportunities.
The solid line is the real-time estimate by the Congressional Budget Office (CBO) that was used in the Taylor rule prescriptions in Figure 1B, while the dashed line depicts the CBO's ex post estimate of the output gap as of the third quarter of 2007. Back in 2003, the CBO estimated that output at that time was below potential by only 1 percent.