Of course, the world has changed a great deal since the Treaty of Paris, and with it the political motives driving the integration process. Nevertheless, if one draws a parallel between the world of 50 years ago and the world of today, one cannot deny that the current enlargement process is driven, at least in part, by the desire to ensure a future of peace and stability for the whole of Europe, and not just for the 15 nations which currently comprise the European Union. Of perhaps even greater significance in today’s globalising world are the “economic” forces driving European integration. This is not to say that they were not already important in the early years of the process. Indeed, just as it became apparent 50 years ago that Europe needed to break free from the ghost of nationalism, so too it became clear that the protectionism of the inter-war period also had to be abandoned. This was an essential prerequisite for restoring economic growth and improving social conditions in post-war Europe. And so it is for the accession countries today, which no doubt see their integration into the EU as a way of ensuring that the necessary conditions are created for the sustainable, long-term growth of their economies. Of course, these political and economic forces to which I refer are very closely linked. So much so, that it is hard to imagine one without the other.
Furthermore, real estate prices continued to rise but, as in 2013, momentum remained below the levels observed until 2012. Developments still varied widely from one region to the other. Whereas real estate prices in some regions hardly increased or even decreased, other regions continued to register significant price rises. However, it is still too early for an all-clear. First, the imbalances that have built up since the beginning of the low-interest-rate phase remain at a high level. Second, mortgage interest rates have again dropped to historically low levels in the past few months. And third, there are no broad-based indications of a change in the banks’ risk appetite. Mortgage lending growth at the domestically focused banks has also decreased, but is still markedly higher than overall market growth. Moreover, the affordability risk (loan-to-income ratio) in mortgage lending has continued to rise, interest rate risk remains at a historically high level, and interest rate margins have fallen even further, from a level which was already low. In these exceptional circumstances, banks should ensure that their resilience is high enough to be able to bear the risks taken, even in the event of a marked real estate price correction combined with an interest rate shock. The countercyclical capital buffer plays a significant role in this context by ensuring that banks hold additional capital as a buffer in the current situation. Adding to that, many banks have a surplus of capital with respect to the regulatory requirements. Such surplus capital is especially important under the current circumstances.