ECB’s Knot: ‘Uncertain Times Ask for Robust Policies’

11 April 2025

ECB’s Knot: ‘Uncertain Times Ask for Robust Policies’
Klaas Knot, governor of De Nederlandsche Bank, at the European Central Bank Forum on Central Banking in Sintra, Portugal on July 3, 2024. Photo by the ECB under CC BY-NC-ND 2.0.

By Marta Vilar – MADRID (Econostream) – European Central Bank Governing Council member Klaas Knot said on Friday that policymakers should deliver robust measures in the face of high uncertainty.

In a speech at the Eurofi conference in Warsaw, Knot, who heads De Nederlandsche Bank, said that ‘the current state of the world is more or less a given’ for financial policymakers.

They must ensure that the financial system remains resilient to resist coming shocks, he said.

‘Uncertain times ask for robust policies’, he said.

Resilience in the financial sector could help the economy withstand trade tensions and geopolitical frictions, he said.

There is still more to be done to make banks more resilient, according to Knot.

‘For one thing, the final Basel III standards, that are meant to repair key weaknesses in banking regulation, still need to be implemented in many jurisdictions’, he said. ‘In the meantime, the banking turmoil of two years ago was a reminder that bank failures are not a thing of the past.’

Knot proclaimed himself in favour of simpler banking rules as long as prudence prevailed.

‘You want simpler rules? Sure, but those rules are then calibrated at a more prudent level’, he said. ‘That is the logic behind the leverage ratio. That is also the logic behind the standardised approach.’

 

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