We have configured the activities and reporting lines in order to ensure full operational independence and to avoid conflicts of interest between the supervision and resolution functions. Of course, this takes place without prejudice to the exchange of information and cooperation obligations. To be more specific, supervisory decisions do not pose constrains to resolution-related ones. Moreover, the staff involved in performing the resolution function is structurally separated from the other NBR functions. 3. Romania: a short history of institutional changes for ensuring financial stability The global crisis has made obvious for all of us that price stability and financial stability are much more intertwined than we used to think. I believe this development has farther-reaching consequences when it comes to the future of central banking. As I pointed out in November last year at the World Policy Conference organised in Montreux, I cannot imagine a future where the explicit concern for financial stability and the macroprudential policy are not central banking fixtures. In Romania, the concern for ensuring and strengthening financial stability was visible in several significant changes of the institutional framework, operated already before the outbreak of the global economic and financial crisis. Specifically, the NBR’s Financial Stability Department was created as early as 2004, with the first edition of the annual Financial Stability Report – a report that will be published on a half-yearly basis starting this year – being released in 2006.
What the crisis has indeed challenged is the widespread conviction that meeting one particular stability criterion, while necessary in order to achieve the others, is also a sufficient condition  BIS central bankers’ speeches  1  to do so – after all, maintaining price stability, while valuable in itself, has proved insufficient to ward off major financial or macroeconomic instability. As a matter of fact, Andrew Crocket claimed ever since 2003 that the “peace dividend” yielded by the successful war against inflation had not lived up to expectations and therefore the battlefront against financial instability should not be overlooked. Regardless of how this battlefront is approached, it is of the essence to make sure that the tasks entrusted to the central bank are feasible. Otherwise, if the monetary authorities are overburdened with possibly conflicting goals, the major risk is to render them inefficient and unable to deliver a single one of their objectives. This is the very reason why the issue of central bank governance is so intricate and delicate: one needs to reconcile objectives that, under certain circumstances, might even prove incompatible. 2. Integrating or separating price and financial guardianship Given that the conference focuses on central bank and supervisory governance, allow me to touch on the issue of integrating price guardianship and financial guardianship within the central bank. As you probably remember, the idea that the two tasks should be completely separated has gained ground in the 1990s.