PRESS RELEASE
BoA co-hosts conference on “Negative Euro Area Interest Rates and Spillovers on Western Balkan Central Banks' Policies and Instruments”

On 4-5 May, the Bank of Albania co-hosted with the International Monetary Fund and with financial support from the Swiss Government through the State Secretariat for Economic Affairs (SECO) a conference on: 'Negative Euro Area Interest Rates and Spillovers on Western Balkan Central Banks' Policies and Instruments'

Organised in three sessions, conference proceedings were opened by Governor of the Bank of Albania, Mr. Gent Sejko, the Swiss Ambassador in Albania, H.E. Christoph Graf, and Deputy Director of the IMF's Monetary and Capital Markets Department, Mr. Miguel Savastano.

In his welcome address, Governor Sejko said that our financial systems have been affected by the presence of euro area bank subsidiaries, which were exposed to the tightening by the regulatory framework in the European banking sector. This tightening was a result of the weaknesses in the system arising from the financial crisis.

He added that in the long term, we will all benefit from a stronger, better capitalised and more stable European banking sector. However, in the short term, the adaptation to this new regulatory environment is a challenge to the countries of the region.

Concluding, Governor Sejko underlined that this conference's purpose is to identify economic and financial spillovers in the Western Balkans arising from negative interest rates in the euro area and challenges for central banks in identifying the mechanisms that may be considered as most effective under certain circumstances.

Governor's welcome address

The Swiss Ambassador to Albania, H.E. Christoph Graf in his address to the conference said he was convinced that based on the Swiss experience macro-economic and financial sector stability is crucial for economic growth. He added that this is why the Swiss government assists various countries in the region and around the globe in strengthening monetary policies. This conference is part of that effort. He pointed out that a sound monetary policy supports macroeconomic stability and growth. It fosters a conducive environment for private sector initiatives.

In his address to the conference, the Deputy Director of IMF's Monetary and Capital Markets Department, Mr Miguel Savastano, said that this conference will offer an excellent opportunity for participants to discuss about challenges in building monetary policy, and exchange views and experience related to financial stability, reserve management and monetary policy.

The first session is dedicated to challenges for central banks related to reserve managements, in the context of negative interest rates in the euro area.

In the second session, discussions focus on financial stability issues and implications from the volatile capital flows and exchange rate.

The third session of the conference addresses the monetary policy developments amid low interest rates and challenges for the monetary policy due to the euroisation of the financial system.

Representatives from Western Balkan central banks, including the Central Bank of Bosnia and Herzegovina, the Central Bank of Kosovo, the National Bank of the Republic of Macedonia, the Central Bank of Montenegro, the National Bank of Serbia; the European Central Bank; central banks in the vicinity of the euro area, including the Bulgarian National Bank, the Croatian National Bank, the Czech National Bank, Magyar Nemzeti Bank, the National Bank of Romania, the Swiss National Bank, the BIS; and representatives of Academia are taking part in this conference.