•  Another recent example: the European Market Infrastructure Regulation requires financial market infrastructures to be subject to European rules or rules that are deemed equivalent to Europe’s before they can provide services to EU players. These rules are well-intended and seek to address genuine regulatory concerns in these jurisdictions. But extending national rules across borders often gives rise to overlapping regulations, which can create additional compliance costs for internationally active financial institutions. If there are conflicts between different national requirements, or if the burden of complying with multiple sets of rules is significant, this may prevent the execution of trades on a cross-border basis. The risk is that the global derivatives and foreign exchange businesses, for example, might become trapped within regional borders, creating fragmented markets. Cross-border application of national rules may also risk complicating home-host collaboration, the principle of consolidated supervision, and cross-border resolution. •  A BIS working paper published in April 2013 cautioned that it may be difficult to design resolution plans for global banks which are required by different national regulations to operate different business models. •  An IMF staff discussion paper published in May 2013 highlighted that differences between national structural reforms could lead to cross-border regulatory arbitrage by global banks, posing a challenge to consolidated supervision. In the event that the imposition of national regulations across borders is unavoidable, we need robust mutual recognition frameworks in place. Such frameworks should be based on an outcome-based approach, and not a line-by-line correspondence of rules.

Credit denominated in ALL maintained the average annual increase rate, by about 28-30 percent, but the slowdown of lending denominated in foreign currency has led to the decline of credit growth pace. The open market operations of the Bank of Albania met the liquidity needs of the banking system. Bank of Albania has injected all liquidity demanded from commercial banks, by preserving at the same time an accurate time structure of this injection. Notwithstanding the improved liquidity situation, yields rates in primary market have persuaded the increasing tendency of the current months. The increase of risk evaluation from banks is mainly reflected in the determination of long-term yields that is confirmed by the rise of 2 and 5-year bonds yields. The performance of new deposits interest rates denominated in Euro and ALL appears stable during July. New credits interests’ rates denominated in ALL have persuaded the decline in July, while this month recorded a tightening of new loan cost denominated in Euro. At the conclusion, by framing the forecasts for a relaxed inflation and within the target set out by the Bank of Albania for the future, the Supervisory Council of the Bank of Albania decided to keep the key interest rate unchanged. This movement is a continuance of the careful monetary policy pursued by the Bank of Albania during the year 2009, a policy which has aimed the transmission of controlled monetary stimulus and the keeping of inflationary expectations close to the targeted band of the Bank of Albania.