role of institutions, including the central bank. presently, the central banks have turned to macroprudential measures, because the traditional mechanisms of monetary policy transmission are suffering from burdened balance sheets of the private and public economic agents. to better coordinate this role and monitor the economy, central banks around the world are supporting their monetary policy with the necessary macroprudential measures. these global developments find the bank of albania well prepared and equipped with the required experience. its structure is similar to the one being adopted by the european central bank and other central banks in developed countries. moreover, the bank of albania has now several years of successful experience in employing countercyclical measures to manage the country ’ s macroeconomic and financial equilibrium. bis central bankers ’ speeches i would like to underscore the change of risk coefficients for controlling the expansion of lending in foreign currency, and the introduction of limits of credit to collateral ratio for controlling the size of debt in the economy …. to mention just a few. one of the most important lessons from the global crisis is that addressing the monetary stability ( i. e. price stability ) and financial stability issues independently does not provide an optimal solution and is crisis - prone. the economy functions as a complex mechanism with often fragile and interdependent equilibria, which do not respect boundaries of institutional responsibilities. for each economy, there is only one interest rate, only one critical mass of financial intermediation and a fragile equilibrium of financial sector balances that guarantee sustainable and long - term development for the country. harmonising these three objectives is a prerequisite for maintaining the financial equilibrium of the economy. therefore, their identification and harmonisation under one roof is considered as the optimum solution to guarantee the country ’ s economic and financial stability. for that reason, one of the most pursued practices for post crisis institutional regulation is not only unification of supervisors of the financial system, but also their institutional integration with other functions of the central bank. * * * your excellency prime minister of albania, dear participants, unquestionably, in the long term, economic growth of a country is determined by the labour force and its qualification, productivity, technology and innovation capacities ; as well as the capital accumulation scale, which in itself, reflects both social preferences and fiscal stimuli and the development level of the financial system. these three sets of factors are conditioned by the economic structure of a country and they are encouraged and stimulated through structural reforms. again, in the

euro area. we have persistently invited policymakers and economic agents in the country to partake in this vision. as the country ’ s monetary authority mandated to guarantee price stability, we have worked and will continue to do so to ensure a low - inflation environment. this environment boosts the guarantees for savers and investors for their long - term plans and provides for financial system development. the bank of albania implements a modern monetary policy based on the most advanced principles of central banking, and employs instruments and communication approach in line with ecb practices. the commitment of the bank of albania to maintain price stability is the polar star of our work. drafting and implementing the monetary policy independently, exclusively in the function of price stability, is one of the domestic anchors of the albanian economy, which should be preserved and strengthened. in parallel, the bank of albania deems that the albanian economy needs two additional anchors : financial stability and fiscal stability. our regulatory and supervisory function over the banking system, which accounts for 95 % of the financial system in albania, has proven successful in guaranteeing the country ’ s financial stability. this function has been carried out and is discharged in line with the international best practices, in constant cooperation with homologous institutions and other international partners. the possibility to have an integrated vision of economic and financial developments, and to combine but not mix the monetary policy with macroprudential measures, has enhanced the effectiveness of bank of albania ’ s actions, and has contributed to better achieving the two individual objectives : financial stability and price stability. the institutional regulation, which has proven effective and is in line with the latest global trends, should continue to function as a second anchor of domestic economic anchors. finally, the bank of albania deems that albania should immediately establish not only a clear and transparent fiscal rule, but also an effective one to discipline the fiscal policy and maintain the trust of financial markets in public finance soundness. this third anchor would complete the framework of domestic anchors of economic policy. together with the close cooperation with international financial institutions, it would provide a consistent and transparent framework for the country ’ s development. provision of liquidity and solvency of the albanian economy through bilateral and multilateral partnerships is a priority for central bank policies. this vision and partnership should become the axis of cooperation between national institutions. bis central bankers ’ speeches