Banking system and supervision  The Albanian banking system has faced numerous challenges over the recent years and has succeeded in overcoming them, always maintaining sound parameters of liquidity and capitalisation. Even in 2011, banking system activity was conducted in an unfavourable context of international financial markets and the sluggish demand for loans and economic growth at home. Regardless of these factors, banks in Albania remained well capitalised and healthy. Economic growth slowdown was reflected in moderate performance of crediting and increase in non-performing loans, whereas bank liquidity condition improved. During 2011, prudence for monitoring the banking system was heightened for early identification of potential risks, and the regulatory framework was consolidated. Stress-test results show that the banking system remained stable and resilient to large shocks on macroeconomic indicators and parameters. Following, I would like to focus on several main indicators of the banking system in 2011, as this system remains the main actor of financial intermediation in Albania. Banking system highlights At end-2011, the banking system assets accounted for about 85% of GDP, from about 81% at end-2010. Financial profit of the banking system was downward, with a significant increase in provisioning expenses playing a determinant role. In the framework of absorbing any potential losses from credit risk, the banking sector increased the provisioning by about 52.4% from a year earlier. By contrast, net operating profit was up by about 7.7%, which shows that the banks have generally achieved a stable net profit and volume from their core activities.

Active participation in this endeavour by the State and local authorities, academic institutions, private, non-profit and public organisations is crucial for its success. Official endorsement is thus of paramount importance. The participation of private and not-for-profit stakeholders in the National Strategy's implementation will be further supported by the development of a code of conduct and prior agreement to specific protocols. A code of conduct is envisaged to provide a uniform framework for the contribution of stakeholders in order to achieve the common objectives set. Public awareness on financial literacy through tailored campaigns is equally important, as it will facilitate the receptivity and usefulness of a National Strategy for financial education. Last but not least, a challenge lying ahead is the proper governance structure for the body that will undertake the implementation of the National Strategy on financial literacy. International organisations such as the World Bank2 have clearly opined that national strategies should be initiated, developed, and monitored by a credible and unbiased authority with financial education expertise and appropriate flexibility and resources. In many cases it is deemed that Central Banks can play such a role. Concluding remarks At this point, I would like to emphasise once again my personal interest and my commitment to assist the Committee's role in achieving its goals. Enhancing the population's financial literacy is an ambitious but needed goal.