to give us a competitive edge in the global market for research. i am grateful to professor mamingi, who is the one who spotted the potential for making our research output distinctive in this way. bis central bankers ’ speeches over many years the central bank of barbados has made its name as an institution that is oriented towards research and analysis. the internet and electronic media have offered us the opportunity to get our message to a global audience. however, because there are so many millions who are also clamouring for an internet audience, the central bank has to offer a product that is of interest, and differs from the others. the many ways in which foreign exchange availability constrains our economy, and economies of similar size, constitutes a research agenda that no other central bank appears to be addressing. it is a niche that we at cbb have begun to fill, with working papers on monetary policy, the integration of monetary and fiscal policy, the structure of the small open economy, and several others ; with the publication of our fiscal stability book by the caribbean centre for money and finance, we are leading the caribbean in the direction of analysis that recognises the fx constraint. there is great potential here for us to make this our distinct contribution to the international debate on the diversity of economic policy and the implication for policy implementation. our bank ’ s annual review seminar is now an established part of the caribbean economic landscape, and a marketplace that many of us look forward to each year. it is an opportunity for an enlightening interchange of ideas, and a chance to our interns and many of the region ’ s young economists to gain their spurs. as we go forward, we should seize opportunities to develop insights that will enrich the global economic debate, because the problems we face are not unique to the caribbean. the focus on the foreign exchange constraint to small economies like our own is a vitally important insight. there a scores of counties worldwide who can benefit from our analysis of the implications of this constraint. we must continue to explore the effects of the constraint in our research, and we should use the ars and other avenues of dissemination to the maximum, to get this message out. bis central bankers ’ speeches

to interest rate risk, the spread between assets and liabilities repricsed up to three months, accounted for 5. 1 % of earning assets, which shows a low exposure to interest rate fluctuations at system level. moreover, during 2011, the banking system performed positively in terms of compliance with new standards and regulations on operational risk management approved over the year. issues related to transparency and money laundering prevention were an important part of supervision in 2011. to monitor them, a number of examinations on banks and non - bank financial institutions, including bureaux de change, have been conducted. they have revealed that the entities have generally taken preventive measures. transparency and publication of information were subject to reforms in 2011 and aimed at establishing a more appropriate business climate for banks and providing higher protection to the public. banks, on their side, have responded positively by adapting their internal regulatory framework in line with these changes. further improvement is needed to enhance the transparency with regard to credit agreements, which have been a source of customer complaint and on focus of examinations on transparency and corrective measures taken by the bank of albania. the practices for deposit and account estimation, as well as disclosure and addressing of customer complaints are generally regarded as less problematic. supervision of non - bank financial institutions is also a functional part of the bank of albania. their number amounted to 19, from 17 a year earlier ; their specific share remained unchanged, accounting for 3. 1 % of banking system assets. during 2011, their activity posted moderate growth with regard to total assets, loan portfolio and financial profit. overall, non - bank financial institutions have adhered to regulatory framework and supervision standards. however, on - site examinations have identified several problems, thereby making appropriate recommendations related to them. among them, we would highlight the need to : improve lending process ; revise internal regulatory framework ; enhance transparency to clients, etc. the expansion dynamics of the financial sector activity is reflected in the licensing process. during 2011, additional activities requested by banks and non - bank financial institutions were approved, consisting in introducing new market products and diversifying the existing products of financial institutions. moreover, a preliminary approval was granted to new bank branches and agencies ( 10 ), but at low paces, whereas the activity of some bank branches and agencies was closed ( 11 ). as at year - end, there were 528 bank branches and agencies operating in the country and 1 branch operating abroad. regarding supervision of the financial activity under the jurisdiction of the bank of albania, allow me to