However, this is not an easy task by any mean. Rating agencies should satisfy several criteria in order to be eligible. These criteria, as you might already be aware of comprise experience, freedom from external influence, publicly available assessments, requirements to disclose assessment models and approaches, sufficient resources and finally validation or recognition by supervisory authorities in our countries. Third but certainly not the least, the new system poses a challenge to all banks to improve their capacities in order to comply with the new framework to successfully compete and survive. Banks should start adopting a more dynamic and forward looking approach to the evaluation of risk and  provisions since under a risk sensitive approach there is always the risk of pro-cyclicality1, which means bank capital ratios are likely to fluctuate more over the course of business cycles. In spite of the above challenges, in Albania we have already started addressing some of these issues. First, by making sure that we have consolidated the achievements of our supervisory function by completing the requirements of Basel I. We are glad that the good progress has been confirmed also by the FSAP assessment during their mission in February-March, this year. Certain recommendations related with requirements about consolidated supervision, will be followed very attentively; Second, we have been pushing already our supervisory process and the banks, toward a more risk oriented attitude.
One important reason is, of course, the above, namely that the weakness of the krona is the other side of the dollar's strength and reflects the international  BIS Review 34/2001  3  financial unease. We can't do very much about this, no more than can the Canadians or Australians who are in the same situation. Another reason is that we have a price stability target and not an exchange rate target and trying to maintain both with the aid of the repo rate is not an easy task. In many cases the targets are in total conflict with one another. We in Sweden have chosen a floating exchange rate and will therefore have to accept that the exchange rate floats. If the Riksbank were to intervene on the market now and then, we could easily cause speculations as to what exchange rate we might have as a target. The forecasts as to when the Riksbank might intervene and the positions it might take would then become a part of stockbrokers' daily work. This is not a good thing, as it increases unease on the market, rather than reducing it. Nevertheless, it should be remembered that every central bank may need to intervene under certain circumstances, either by buying or selling currency, e.g. to restore some order to a market that has become unbalanced or to even out sudden large flows. In both cases, one should of course state the purpose of the intervention.