The percentage of financially constrained but viable SMEs – defined as those with positive turnover in the last six months seeking a bank loan – was estimated to have varied from around 1% in Germany and Austria to a quarter of the SME population in Spain and as much as a third in Portugal. The second part of our response has therefore been to improve the transmission of loose market financing conditions into the actual borrowing conditions of firms and households. In this context, between June and September last year we launched our credit easing package to strengthen banks’ incentives to improve the availability and lower the price of credit. In parallel, we gave our full technical and operational support to the Comprehensive  BIS central bankers’ speeches  1  Assessment of bank balance sheets – the supervisory exercise aimed at forcing banks to acknowledge non-performing exposures and to raise provisions and capital where needed. This exercise was powerful in the sense that it accelerated what had until that point been a slow process of balance sheet repair in the euro area; banks strengthened their capital by over € billion in advance of the outcome. In this way the new monetary policy impulse coming from our credit easing package coincided with a banking sector in a stronger position to transmit it. But as these measures were coming into effect the euro area was hit, like all advanced economies, with a further downward shock to inflation emanating from the steep fall in global oil prices.
In an environment of increased uncertainty about  BIS Review 27/2001  1  the global economy and its impact on the euro area, the Governing Council is carefully assessing whether and to what extent upward risks to price stability will continue to decline. As far as the first pillar of our monetary policy strategy is concerned, the decrease of money growth indicates that upward risks to price stability have receded. As for the second pillar, domestic upward price pressures may decrease as a result of somewhat lower than expected GDP growth in the euro area. However, due to the risk of secound-round effects from past oil price increases, wage developments will be monitored carefully, as these might result in upward price pressures. In the financial sphere, the advances in information and telecommunication technologies have started to have their effects. This was perhaps even more visible than in the non-financial sphere. In the banking sector, a development that has attracted considerable attention over recent years is the emergence of internet banking. The first financial products and services to be distributed over the Internet were rather standardised ones, in fields such as securities brokerage and payment services. More recently, a wider array of financial products and services have become available over the internet, which has thus become an important distribution channel for a number of banks. Many banks in the euro area have already developed the internet channel to various degrees.