First, the Bundesbank has always been critical of government bond purchases by the Eurosystem central banks as they lead to a dangerous commingling of monetary and fiscal policy. Second, as inflation has increased, the real interest rate has declined even further. The effects are comparable to a central bank rate cut.
Usually, however, resilient banks have specific characteristics that set them apart from other banks. In my remarks today I would like to discuss three of these characteristics – three pillars on which resilient banks rest. 2.1  Capital and liquidity buffers  Capital and liquidity buffers should be regarded as the centre pillar. Capital provides a cushion to absorb losses during times of stress.