to assist that committee in its further development of internationally recognised accounting principles. it is therefore also in the interests of the banking supervisors for the joint project of iasc and iosco to reach a successful conclusion. whether the last core standard ( on financial instruments ) can actually be approved or not at the moment is not so important in my opinion. what is important is that the other partner, iosco, is subsequently able to fulfil its part of the agreement. as national financial markets in an open global environment can no longer be protected by national rules alone, it is in the interest of all of us that international accounting standards are applied worldwide, especially in the emerging countries as well. iosco can make a substantial contribution towards this goal by ensuring that the worldwide acceptance of iasc standards is a precondition for stock exchange listing. the imf and world bank, which, incidentally, have also recommended that the core principles of the basle committee be used worldwide, are focusing during their country inspections on whether and to what extent internationally recognised principles are being implemented and observed in the various countries. the basle committee itself supports national supervisors in the implementation of its principles. v calls for greater transparency in the markets have also been made by the g - 7 finance ministers and central bank governors for some time now. the call of october 30, 1998 to iasc to submit proposals for a complete range of accounting standards in the spring of 1999 implies a strengthening and international recognition of iasc as well as a great responsibility and commitment on the part of this body. the international organisations responsible for supervising securities trading, insurance and the banks are being called upon to put these standards to the test. only the international acceptance of these standards can make sense in the end. at all events, the basle committee will do all it can on the banking supervisory side to contribute to this end. vi from germany ’ s point of view, it is particularly gratifying to see that the latest core standard within the iasc - iosco project is being approved during a german accounting standards committee forum. a natural person as young as the gasc would not be able to talk yet. the commitment of the g - 7 finance ministers and central bank governors to apply the recognised principles in their respective countries will necessitate some adjustments in germany, too, which will give rise to interesting discussions and make particular demands on our fledgling gasc. i am thinking here of the introduction of current value accounting for the trading portfolios of

mr meister remarks on the role of credit institutions against the background of banking supervision speech by mr edgar meister, a member of the directorate of the deutsche bundesbank, to the gasc forum on international harmonisation in frankfurt on 16 / 12 / 98. i iasc ( the international accounting standards committee ) and iosco ( the international organization of securities commissions ) have undertaken to develop internationally applicable accountancy principles and to accept them worldwide as a precondition for cross - border stock exchange listing of securities. this plan has aroused considerable interest among central banks and banking supervisors. a theoretical distinction can be made between a national and an international perspective. in practice, however, both are interlinked. in an age of global interdependency of goods and financial markets, it is no longer meaningful to lay down national rules autonomously. the asia crisis has once again highlighted - and has done so dramatically that crises in one area of the world can spread like wildfire and adversely affect financial markets in other regions, however remote. that event has stepped up the debate on how the international financial markets can be made more stable. among the buzzwords we hear in this context are intensify banking supervision and enhance transparency. there is no disputing the fact that one of the major preconditions for a stable financial market is an effective system of banking supervision - in addition to sound economic and fiscal policies. if banking supervision is to be effective, however, the preparation and publishing of accounts are of major importance. as the member of the bundesbank board responsible for banking supervision, i would like to focus my remarks on the role of the credit institutions. ii banking supervisors depend on institutions fulfilling their reporting requirements and deriving the requisite capital adequacy on the basis of reliable accounts. accounting functions such as the provision of internal information, documentation, ascertainment of profits and losses and informing the market are also useful for banking supervision. it will therefore come as no surprise if i emphasise the advantages of a prudent determination of profit in the banking field with the aim of capital maintenance. that does not necessarily imply undisclosed reserves, which impair the informativeness of the annual accounts. however, the historical cost principle and the principle of the lower cost or market should be retained in the case of banks, at all events where the objective is to ascertain the profit eligible for distribution. furthermore, thought must be given to the capital adequa