And we are much better able now than we were to ensure that a failing bank can if necessary be stabilised so it can continue to provide critical services to the economy. What remains to be done? However more remains to be done. First and foremost, we need to implement fully the reforms I have mentioned. Banks need to continue to build up the necessary loss absorbency and to restructure as necessary to ensure operational continuity in resolution. This is perhaps an obvious point, but one that needs repeating. It is 10 years since Northern Rock failed and memories may be beginning to fade. 6  All speeches are available online at www.bankofengland.co.uk/speeches  6  Ensuring that we have a better option than insolvency or a bailout, is not costless. And, as that cost becomes apparent in a number of jurisdictions, there are increasingly voices calling for the reforms to be watered down or abandoned. It is argued that they are too expensive for banks, especially small banks, to implement and will restrict lending to the real economy. On the cost, I would emphasise the cost not only to the taxpayer but to the economy as a whole of disruptive bank failure. In the UK, the going concern capital regime is based on assurance of there being an effective way to resolve failing banks. Absent such assurance, if this risk of disruptive bank failure remained as in 2008, we would require banks to hold appreciably more capital to absorb losses.
There is no growth without credit, and without growth, savings lose their value. Therefore, it is imperative that short-term goals do not prevent the adoption of a strategic and longer-term vision. Banks should invest with a view to developing functions related to financial consultancy services for their clients. They need to persistently seek to explore the market, to identify potential clients – especially households and small enterprises – and, most importantly, to help them design bankable proposals and projects. At this phase, the reduction of concentration and the diversification of credit portfolios are key elements. This requires that you design and set up relevant structures, processes and products, and plan for adequate financial resources. In parallel, you should continuously assess the surrounding environment, which certainly affects your activity. Thus, if there are concrete proposals for additional legal amendments or supervisory practices, I invite you to formulate and submit them officially to us and other relevant public authorities, so that we can, together, make a swift decision on them. In 2/3  BIS central bankers' speeches  this process, the Bank of Albania will always support initiatives that lead to an eventual improvement of financial intermediation levels and safeguard the stability of the banking sector and of the financial system. Second, our ambition should aim higher than the 3, 4 or 5% annual growth rate. The country needs more optimism, which means higher growth rates and more structural reforms. The banking sector has both a direct and an indirect role to play in this regard.