i have myself made contributions in the field, in collaboration with regional colleagues. the imf sponsored two regional workshops on financial risk analysis in the years i worked for that institution, where we were able to bring together the research that had been done in the caribbean with leading international expertise which the fund was able to provide. out of this effort we now have increasingly sophisticated financial stability reports being published by jamaica, barbados and trinidad and tobago. they all have a regional dimension, because the intra - caribbean linkages are so pervasive that a meaningful assessment of financial stability must take account of risk exposures from around the region, as well as those arising locally. the regional financial architecture is built on this foundation of analysis, as well as the network of cooperation which financial supervisors have established within the caribbean region. we now have regional associations for the supervision of banking, insurance, securities trading and pensions, as well as a regional group on anti - money laundering. bis central bankers ’ speeches the task before you is to stitch together the operational and informational arrangements for regional assessment and monitoring of financial stability on an ongoing basis. the outlines of the way forward are set down in the project document on the basis of which the idb agreed to provide funding for this effort. it envisages that each country ( or sub - region, in the case of the eccu ) will have established an overarching framework for financial stability, led by the central bank. the regional architecture then becomes the mechanism which binds together the national and sub - regional financial stability functions. at its apex sits the committee of central bank governors, with each governor in their capacity as head of the financial stability function in the area under their jurisdiction. it is the task of the current conference to advance the process of putting that system in place. this is a high priority for the caribbean region, and we look forward to a speedy conclusion of your work. bis central bankers ’ speeches

operating costs and to better coordinate the prices of the different integrated services ( e. g. trading, clearing and settlement ), they may reduce competition when they are misused, for example, to favour a central counterparty in the silo over its competitors outside of the silo. as the eurosystem explained in its policy statement of september 2001, the disadvantages of vertical silos “ can be overcome provided that customers can choose between systems along the value chain [ … ]. it is therefore crucial that access to essential facilities, whether vertically integrated or not, should not be unfairly impeded. ” d ) growing need for adequate infrastructure in the field of credit derivatives volume growth in derivatives – especially otc derivatives – outpaces the cash markets, spurred on by increased interest in hedge funds and the ongoing innovation in the types of contract offered. while interest rates contracts remain the key hedge instrument ( 187 tri usd outstanding ), credit default contracts ( 6. 3 tri usd outstanding ) are growing at approximately 90 % per year, now reaching 10, 000 trades per day. volume growth is expected to continue over the coming years, causing some concern among operations managers on the otc market, given the lack of straight - through - processing and hence capacity to manage the volumes. this rapid multidimensional growth ( i. e. in terms of products, volumes, market participants and secondary markets ) calls for an enhancement of the post - trading infrastructure that may support more careful risk control by the various participants. as mentioned by governor kroszner, enhancing the post - trading infrastructure does not automatically mean to introduce telles quelles the same techniques that ccps use in exchanged - traded derivatives but rather to identify the solutions which are equally effective and take into account the different features of otc markets. all these developments refer to the market structure that surrounds central counterparties and are highly relevant for the interests of central banks in the fields of financial stability and financial integration. as central banks, we believe that the market structure should be market driven as long as market failures are not observed. significant market failures however must be identified and in many cases require appropriate public intervention. this brings me to my last point. what is the role of public authorities and, in particular, central banks? market forces need a sound legal, regulatory and oversight basis to work efficiently. in the euro area with its 12 countries, and in the european union with its 25 countries, the creation of such a sound basis requires first