ladies and gentlemen, 2 / 3 bis - central bankers'speeches in conclusion, i would like to emphasise that this is not the time to rest in our laurels, but we need to reflect on future challenges in order to render the local capital market as vital and as functional as possible. the approval of the latest policy paper " on creating an environment which facilitates the development of capital markets in albania, 20232027 " is a qualitative step toward the identification of problems and obstacles and of relevant suggestions to improve the main components for the development of capital markets. they aim to further complete the legal and regulatory framework, the market infrastructure, financial education and the development of various capital market segments. in this framework, the bank of albania in cooperation with the afsa and the ministry of finances and economy is undertaking the necessary steps to start an important project with the ebrd, which will identify the need to amend the legal acts that regulate financial market activity, aiming to render the trading environment safer, for both international and national investors. given the characteristics of the albanian financial market, the bank of albania deems that the development of capital market must be stable and gradual. it should give priority to opportunities that attract more non - resident investors, strengthen investing capacities of non - bank financial institutions and increase liquidity in their secondary markets. furthermore, the expansion of both stock and derivative products will be driven by strengthening the harmonising capacities of supervision and reporting to lawabiding institutions. on the other hand, the policy - making should also allow fiscal facilitations, primarily in regards to investors, which would translate in low financing costs for the issuer. also, creating a special room in the administrative court to resolve financial market disputes will help improve the investing climate. in the same vein, the establishment of the financial ombudsman will ensure legal support to investors that are engaged in or benefit from financial services. last but not least, the banking system should support the capital market development through the diversification of investments toward corporate products. this market should be considered complementary rather than as a competition to the economy, where banks would profit in regards to both investment portfolio diversification, as well as better risk management. i wish the best of luck to the financial stakeholders present here! thank you for your attention. 3 / 3 bis - central bankers'speeches

restate financial results because of inappropriate accounting. both corporate financial officers and outside auditors failed to effectively evaluate the sophisticated nature of the underlying transactions and arrive at the appropriate accounting policy. at a few banks, the evaluations were ineffective for special - purpose entities and derivatives. you have all read accounts of these incidents, and i will not dwell on them. rather, i want to illustrate operational risk in relation to a basic accounting concept by discussing another area of weakness that bank regulators determined needed attention - accounting for subprime credit card activity. the accounting concept is not new or esoteric. rather, the nature of the subprime credit card business, compared with that of the prime card business, is to rely much more on fee income than on interest income for revenue. for subprime accounts, rapid growth of the account base can mask underlying revenue trends. some financial institutions did not have management information that allowed them to track the percentage of delinquent accounts that were not paying late fees and other charges that had been billed. in such situations, the accounting is very straightforward. even if you have billed a customer for services, if you do not think you are going to collect the fee, you should not recognize the revenue and should set up a reserve for bad debt. some financial institutions with a large subprime client base did not have adequate accounting systems to disclose that a significant amount in fees was not being collected. by recording revenue on the basis of billed fees, these institutions were overstating income. new guidance issued jointly by the bank regulators clarifies these accounting standards. further, at some subprime banks, management information did not reflect the level of charge - offs of fees and advances as accounts aged. by relying on charge - off reports for the portfolio as a whole, portfolio growth was masking the increasing amount of loan losses. this is a good example of how changes in the customer mix and profit drivers of an existing product can lead to unintended loss exposures if management information and accounting do not reflect the economics and risks of the product when it is altered. fdicia : internal controls other areas of operational risk have come to light as a result of the events and debate surrounding the sarbanes - oxley act. i want to talk about a couple of these areas - internal control assessments and the role of outside auditors. since 1991, the federal deposit insurance corporation improvement act ( fdicia ) has required that the chief executive officer ( ceo