The rise in intra-regional trade and investment flows has resulted in greater importance being accorded to stability of the exchange rate against regional currencies. The monetary policy decision-making process at the Bank has also been redefined in which the governance for monetary policy is based on the Monetary Policy Committee to achieve a more optimal process for policy making. Monetary policy communication and increased transparency have also become highly important in this framework. Thus, while the Central Bank's responsibility towards promoting monetary stability conducive to sustainable growth has remained unchanged since the inception of the Central Bank in 1959, the strategies, framework and instruments have evolved substantially to ensure its effectiveness in delivering the desired objective. Financial sector development A key focus of the Central Bank during these five decades has been institutional building, financial market development and putting in place the financial infrastructure. The evolution of the financial system has seen its transformation from a rudimentary financial system that was dominated by the banking sector to a highly diversified financial system, from a highly controlled financial system to greater market orientation, from a highly fragmented system to one that is more consolidated and rationalised, and to a financial system that is supported by an extensive legal regime and regulatory and supervisory framework, and a financial system that is more liberalised with stronger international linkages. Part of the institutional building was the establishment of regulatory institutions that have clearly defined mandates.

Niklaus Blattner: System stability and security of the systems Summary of a speech by Prof Dr Niklaus Blattner, Vice-Chairman the Governing Board of the Swiss National Bank, at the Luzerner Tage für Informationssicherung (LUTIS, conference on information security), Lucerne, 25 May 2004. The references for the speech can be found on the Swiss National Bank’s website. *  *  *  The stability of the banking system and the security of the financial market infrastructure - including the stock exchanges and especially payment and securities settlement systems - have become an important concern of central banks all over the world in recent years. This has notably happened against the background of the numerous financial crises witnessed during the past decades. Moreover, events such as 9/11 have heightened awareness for the security of the financial markets and other infrastructures. In Switzerland, the growing importance of system stability has also been reflected in the new National Bank Act, which entered into force on 1 May 2004. Within the framework of its principal mandate of pursuing a monetary policy in the interests of the country as a whole while at the same time ensuring price stability, the Swiss National Bank (SNB) is legally obliged to make a contribution to system stability and to facilitate and secure the operation of cashless payment systems. In implementing its mandate, the SNB takes preventive measures as well as measures aimed at overcoming crises. For instance, in a crisis the National Bank plays an important role in providing liquidity.