For the euro area insurance sector, low yields on highly rated government bonds can constitute a solvency risk in the medium term. This holds in particular for those jurisdictions where a market-consistent approach to the treatment of liabilities is pursued. In this case, balance sheets are not only squeezed by the low profitability of assets, but also by the high value of liabilities.
Challenges Let me now turn to two of the most important challenges we are currently facing and which need to be addressed in order to fully reap the benefits of the euro, namely raising potential economic growth and the enlargement of the euro area.