In applying this caveat to Spanish institutions, we shall focus on the three lines of defence used by institutions to protect themselves from possible difficulties: risk management, which enables ex ante minimisation of difficulties, and profitability and solvency, which make it easier to absorb risks once they materialise. As regards risks, the low levels of default unquestionably reflect not only the favourable financial and macroeconomic trends, but also improvements in the procedures for identifying, measuring and controlling those risks. The sharp increase in activity, however, poses certain questions to which some thought should be given. First, although the fastest growing instruments are secured loans, their concentration in the real-estate market, together with growing household indebtedness, should be taken into account by managers, since both factors (sectoral concentration and growing indebtedness) entail under alternative scenarios a greater risk, which should be analysed within the framework of an institution’s medium- and long-term financial strategy, taking account of its financial equilibrium conditions. Second, there is a need for the management systems used to incorporate the regular performance of stress tests under adverse scenarios, considering variations in real estate prices, changes in interest rates and other possible modifications in macroeconomic data. This analysis will be of use in regularly reviewing each institution’s strategy and will determine the advisability of establishing internal control measures and how to ameliorate the residual risk incurred. Particular attention is required by those market segments, such as the financing of real-estate development activities, which have shown higher risk in the past.
No: the transformation of the Banque de France is a modest but real illustration of such a reform; for years we have been lowering costs and providing greater services, while maintaining our territorial  Page 8 of 9 presence. I am not saying that efficient public management is easy, but I guarantee that it is possible. Better budgetary control will then be compatible with better financing of the most productive expenditures, which must be prioritised - these difficult choices are obviously a matter for democratic debate. The comparison with our neighbours only seems to indicate that in France, for example, spending on pensions, or "economic affairs" (subsidies and tax credits) is much higher.iv Some futureoriented expenditures (most investments - even if some of them are less useful - but also spending on education and research) have a crucial effect on growth, both in the short term and in the long term. France cannot and must not settle for a potential growth rate of 1.2/1.3%v if it aims to return to full employment and lower its debt in the coming decade. Focusing the debate on the quality of public spending  *** I would like to conclude with two authors who are not very “budgetary”. First, La Fontaine, The Swallow and the Little Birds: "To instincts not our own we give no credit, and till misfortune comes, we never dread it". Let us finally aim to anticipate our budgetary difficulties, in order to reduce them.