In the case of bank lending and pricing, uncertainty in cash flows from the projected carbon credit, and the slow process of local approval, is seen as a major risk to banks. Lack of understanding of CDM and carbon trading market by financial institutions is also a factor weighing on its progress. In the case of investment fund, this is an area that has the strongest potential for private investors’ participation in supporting clean technology and energy-efficient companies. Again, clarity beyond 2012 is needed for evaluating the longer-term economic payoffs, and whether carbon credit is considered securities legally is an issue in some countries. What I have mentioned are some of the practical issues that have emerged in emerging markets, and need to be addressed in order to be able to speed up the process. To conclude, climate change is a big deal for the financial system for a number of reasons that I have mentioned. As for the response, the overall direction of the financial sector’s response to climate change so far is positive, but still very much in an early stage. The progress, however, is more limited in Asia. To promote greater engagement of the financial system, the issues of incentive and availability of tools are important.
At the end of the process, Banca d’Italia and Deutsche Bundesbank were selected to implement Bank of Albania’s project. Banque de France and National Bank of Romania are also part of the team for certain components of the project. We feel privileged, certainly, by this close partnership with these two major central banks. Relations with these two institutions date back to quite early in the history of the Bank of Albania. 1/2  BIS central bankers' speeches  Whether multilaterally or bilaterally, they have assisted for many years the Bank of Albania achieve its objectives and operate like a modern and reliable institution. I am therefore optimistic about the success of this next project, irrespective of the relatively tight agenda and deadlines. Now, let me briefly introduce you to the main components of this project. It will involve eight departments at the Bank of Albania and will address important issues, grouped as follows: 1. Banking Supervision and Financial Stability 2. Monetary Policy and Statistics 3. Internal Audit 4. Payment Systems 5. Other central banking functions such as human resources and European integration For each component, measurable results have been envisaged, which will be translated into regulatory documents, guidelines and specific recommendations related to policies. All outcomes will aim to approximate the final product at a higher level to standards and models of the European System of Central Banks.