Enhancing co-operation among the Banking Supervisory Authorities of South Eastern Europe
08/02/2008 - Press Releases
At the invitation of Mr Nicholas C. Garganas, Governor of the
Bank of Greece, the Governors of the Central Banks of Albania, Bulgaria, Bosnia
and Herzegovina, Cyprus, Former Yugoslav Republic of Macedonia, Greece,
Montenegro, Romania and Serbia, as well as the Heads of the two Supervisory
Authorities of Bosnia and Herzegovina, met in Thessaloniki on the 8th of
February 2008. The meeting was held within the framework of the multilateral
Memorandum of Understanding that was agreed at a meeting in Athens in July 2007
and aimed to further advance co-operation in the area of banking supervision in
South Eastern Europe (SEE) and safeguard financial stability in the region. The
discussions at the meeting took into account the conclusions of a Meeting of
Heads of Banking Supervision Departments that was held in Thessaloniki on the
18th of January.
The Central Bank Governors noted that the consequences for
the SEE economies of the ongoing turmoil in the international financial markets
have been indirect and limited until now. They also acknowledged heightened
uncertainties to the outlook of SEE economies stemming from a possible further
deceleration in the growth rates of world output and trade in the event the
turmoil persists. Against this background, they stressed the importance of sound
financial and economic fundamentals. In light of the rapid credit growth
observed in many countries of the region, their supervisory authorities were
closely monitoring credit developments to safeguard the quality of the banks'
loan portfolio and financial stability. It was also important for macroeconomic
and structural reform policies to be strengthened in many of the countries of
the region with a view to containing inflationary pressures and the external
current account imbalances. Large current account deficits, especially if they
reflect low savings rather than productive investment, could weaken growth
prospects and investor confidence.
The Central Bank Governors decided to accelerate the
implementation of the multilateral Memorandum of Understanding with a view to
achieving convergence of supervisory practices, including those relating to
money laundering and the financing of terrorism, and risk assessment. Towards
this end, the experience gained from the implementation of the corresponding
European Union framework as well as the principles established by the Basle
Committee on Banking Supervision will be utilised, while national institutional
and legal arrangements will be respected. It was agreed that issues of immediate
priority would be the identification of those areas in which convergence of
supervisory practices should be pursued, the undertaking of joint field
examinations of cross-border financial institutions, and a joint evaluation of
the stress-testing exercises that are being undertaken in each country.
Finally, at the invitation of Mr Iskrov, Governor of the
National Bank of Bulgaria, it was agreed that the next meeting of the Governors
of South Eastern Europe will take place in Sofia in October of this year.