In the United States, these rules were not applicable to SVB, as certain exemptions, introduced in 2019 under the proportionality principle, apply to banks that are considered to be less important, this concept being understood in a broad sense since it includes banks with a balance sheet total of up to USD 250 billion. - The post mortem analyses carried out and published by the FED suggest that, had SVB been subject to these rules, it would not have complied with the short-term liquidity ratio as defined by the Basel Committee. Moreover, SVB's heavy reliance on tech companies' deposits should have alerted its supervisor if the additional monitoring tools required by international standards had been put in place. The same FED analyses estimate that SVB's interest rate risk sensitivity was around 35% before the crisis, well above the 15% alert threshold set out in the international rules and supposed to trigger supervisory action. - Monitoring compliance with regulations calls for strict, intrusive and reactive supervision, which, according to the FED, was not the case. Let me reassure you on one point: the European situation is radically different. The Basel Committee's rules are applied in Europe in their entirety and to all banks. By the way, I would like to add that Europe is in the process of finalising the transposition into European law of the latest reinforcements of the Basel III agreements, ahead of the other major jurisdictions.
Meeting the challenges of innovation and its dissemination as well as ensuring the labour force’s employability and flexibility, requires that human capital is continuously adjusted to labour market needs through improved education and training, as well as lifelong learning. Europe is still badly in need in Europe to enhance the quality and efficiency of our schools and universities as well as to increase incentives for all relevant parties, including firms and workers to invest in human capital. Before concluding, let me insist on the importance of sound fiscal management in line with the Stability and Growth Pact. Sound public finances are a prerequisite to support longlasting growth of output and employment, as the Spanish experience over the last decade has clearly shown. A complacent attitude related to current buoyant tax revenue that might result in higher expenditure could lead to negative surprises, should the macroeconomic environment turn less favourable. Beyond that, the “quality” of public finances also matters for growth. It is essential to increase public spending efficiency in order to facilitate the reorientation of public expenditure towards productivity-enhancing physical and human capital accumulation. And finally, let me remind you that within our currency union, regional monetary and exchange rate policies are no longer viable options. Flexible and integrated labour and product markets are prerequisites of the utmost importance for the smooth functioning of the  16  In the spring 2006 European Council, Member States announced country-specific targets for R&D expenditure amounting to 2.7% of EU25 GDP by 2010, up from 1.9% in 2006.