The Financial Stability Forum (FSF) today held its first European regional meeting with central and eastern European countries at the European Bank for Reconstruction and Development (EBRD) in London. Senior representatives from finance ministries, central banks, and supervisory and regulatory authorities from 13 FSF member and regional countries attended the meeting. A list of participating institutions is attached.

The meeting exchanged views on potential vulnerabilities in financial systems in the current economic situation and noted that financial systems had well withstood recent shocks. They also agreed that the improved outlook for growth is creating a more benign financial stability environment in the period ahead. They noted that appreciating exchange rates in EU accession countries heighten the importance of adequate safeguards in the banking system.

Participants also discussed issues raised by recent large corporate failures, and noted that many bear relevance for regional transition economies. They underscored the importance of reinforcing market foundations through sound practices in corporate governance, improved audit quality, and strengthened independence of oversight and enforcement institutions.

The meeting also reviewed the focus of ongoing work to strengthen financial systems. These efforts centre on EU accession requirements and the implementation international bank and insurance supervisory standards, and international principles for securities market regulation.

Participants thanked the EBRD for its hospitality and expressed interest in future regional FSF meetings.

Updated 4 September 2002