end of the year, which is significantly higher than the annual rates of the pervious years. the credit balance rose by l11. 9bn or 30. 9 %. the new credit increased by 50 % meanwhile 76 % is in foreign currency. the loans / gdp ratio is still low, at about 7 %. the banking system experienced important developments during 2003 and in the beginning of 2004. the entry of two new banks of albanian capital was soon followed by the successful privatisation of the savings bank from the raiffeisen zentralbank ( rzb ) austria. now, all in all there are 16 banks in the albanian banking system. the boa has progressed in reforming the banking system towards international standards, with the aim of the developing and refining the country ’ s banking infrastructure. aips, inaugurated in early march 2004, can be considered as the backbone of the whole banking system infrastructure. the boa wishes to bring its central bank closer to that of the european central bank. therefore, changes and amendments of the bank ’ s regulations are aimed towards achieving this goal.

this regime will provide a better platform for harmonizing the monetary policy with the fiscal one, implying that the fiscal authority will seriously commit to support the proposed setup. to this purpose, we invite the albanian government to reach a consensus on the key objectives of both policies, monetary and fiscal, adopting the convergence criteria as a strategic goal. success in this endeavour requires albania, among other things, not only continuity on the path of sound macro policies but even strengthening them further. this means a monetary policy focused on maintaining price stability and a prudent fiscal policy which will ensure that albania ’ s deficits and debt ratios are sustainable and at low levels to increase the attractiveness to international investors. put differently pursuing a monetary policy focused on price stability and a prudent fiscal policy, will no doubt reduces albania ’ s risk premium. the benefit of this achievement will be felt throughout the economy. to support my idea i have to tell you one fresh news. yesterday albania succeeded to sell internationally a seven year fixed rate bond in lek. this was not a result of a toss of coin, but a reflection of international confidence in the albanian economy and its macro policies. this confidence should increase in 2008, 2009 and beyond. regardless of the monetary policy regime it is to be said that the chances for this setup to be successful are greater under a developed financial market, which understands properly the monetary policy signals and transmits them adequately to the economy. monetary policy efficiency implies the financial market efficiency. this issue has been part of my earlier discussions ; however i would like to highlight that only recently we have taken concrete steps which will improve certain financial market segments. we have currently tried to adopt a set of measures which will facilitate the reformation process of the financial market by further deepening it. in more concrete terms, the government securities market and the interbank market have been most particularly under our special focus. after several consultations with all actors in place we decided to come up with a package of initiatives and priorities during 2008 whose purpose is to establish incentives and minimize risks in the albanian financial market : - broadening and deepening the base of participants in the government securities market starting from january 2008 we will increase the investors ’ base, eligible to directly invest in the auctions of government bonds. we believe it will increase the competition while so - far this was a privilege enjoyed by the banking system. - reducing the interbank market risk so far, the banking system has applied limits on the amounts it can lend in the inter