What’s more, the national supervisors will continuously carry out centrally steered checks to make sure that these institutions, which are often essential to the financing of the local economy, do not as a group pose any relevant risk. Additionally, we have identified, besides the 120 largest banks, 100 others that we will keep a close eye on. We do so because they are either regionally relevant, in bad shape or have specific business models. Will restoring robustness and transparency in the banking system suffice to start credit flowing again in the euro area? With a robust and resilient European banking system, we move a big step forward. Although such a banking system is a necessary condition for sustainable credit growth, it is not the only condition for banks to increase lending to the real economy. At the national level, structural reforms are required that will help firms to regain competitiveness and become sound enough for banks to lend to them. Banks take credit risk when lending to the real economy. They need to be convinced that their customers, such as small and medium-sized enterprises, will make enough profits to repay the loans they receive. The growth prospects for national GDP as well as economic and structural factors such as labour market rules and sound fiscal budgets are therefore relevant criteria for banks’ decision to do business. The ECB will, from now on, have two missions: steering monetary policy and supervising banks. How will a conflict of interests be avoided?
As supervisors we do not think in terms of countries, but of banks’ business and risk profiles. Each bank operates differently and therefore has to face different problems; it would be unwise not to see them individually. BIS central bankers’ speeches  3