Single Resolution Board Annual Conference – Brussels, 19 September 2022 Armed peace and risk proportionality: how to strike the right balance  Speech by François Villeroy de Galhau, Governor of the Banque de France  Page 1 sur 5 Ladies and Gentlemen, It is a great pleasure for me to be with you at the European Commission for the 2022 SRB annual conference, and I would like to warmly thank Dr Elke König for her invitation to give this keynote speech today. Above all, I would like to pay tribute to Elke for her hard work as first Chair of the SRB since its creation in 2015 – SRB staff can also be very proud. You have a strong ally in France, with whom I have great pleasure working each and every week: Dominique Laboureix. I won’t be betraying any great secrets by saying how much he enjoyed taking part in this creation, and how much he remains attached to the SRB. The title of this conference (“European banks: resolvable and ready for crisis?”) may cause some anxiety – yet a healthy type of anxiety. It reminds us of possible dangers ahead, and serves as a strong reminder of what happened to banks during and in the aftermath of the great financial crisis. The temptation to forget about these events would be a huge mistake: lessons of the past, especially of that kind, should remain vivid memories that motivate us, day after day, to build a safer system.
But is there more that we can do to manage the tensions created by these economic 2/3  BIS central bankers' speeches  divergence? Put another way, how do we reconcile yet another paradoxical couple: independence and co-operation? Obviously the question is not to go back to a world of accords negotiated in hotel suites. But we can and should act to enhance co-operation between central banks. Such co-operation includes four elements: Mutual predictability of policy making. We will achieve the closest to a co-operative solution if we avoid large surprises between policy makers. While trade multilateralism is at risk, monetary and financial multilateralism stands fast, fortunately. This means continuing to favor dialogue and exchange of information among central banks, and to be very clear about our monetary policy regime choice. We should cherish the “great convergence” of policy objectives of the last fifteen years. Among major advanced economies, we now have domestic inflation targeting around a 2% medium-term objective. We are ruling out any currency war, as clearly stated in our unanimous Bali communiqué: ``We will not target our exchange rates for competitive purposes’’. On capital flow management (CFM) measures, we should support the ongoing reflections undertaken within the relevant international bodies and give priority to practical and pragmatic solutions – IMF type – rather than dogmatic purity. Last, I can only quote you, Tharman, and your impressive EPG report: “It is critical that we put in place a reliable Global Financial Safety Net before the next crisis” and co-ordinate its different layers.