Richard Melson

June 2006

BIS Review No.58

http://www.bis.org/review/index.htm

Please find BIS Review No 58

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What's included?

BIS Review No 58 (26 June 2006)

BIS holds Annual General Meeting and releases its 76th Annual Report
BIS statement of account for May 2006
Speech delivered by Mr Malcolm Knight at the 76th Annual General Meeting of the BIS
General Manager's statement, BIS press conference
76th Annual Report 2005/06: an overview
Conclusion of the 76th Annual Report: coping with risks, today and tomorrow

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BIS Review No 58 available

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Press, Service Press.Service@bis.org

Monday, June 26, 2006

The Board of Directors of the Bank for International Settlements (BIS) today announced the election of three additional central bank Governors as members of the Board of Directors of the BIS:

· Guillermo Ortiz, Governor of the Bank of Mexico;

· Jean-Claude Trichet, President of the European Central Bank; and

· Zhou Xiaochuan, Governor of the People’s Bank of China.

See the attached press release and accompanying fact sheet for details.

Regards,
BIS Press & Communications

The term of office of each elected Director of the BIS is for an initial period of three years, which may be renewed. This enlargement of the BIS Board is the first since 1994 and takes effect on 1 July 2006.

Jean-Pierre Roth, Chairman of the Board, welcomed the new members, saying that "they bring the global diversity of BIS membership to Board level". The Board’s main responsibilities are to determine the Bank’s strategy and policy direction and to supervise the Bank’s Management.

The three new elections bring the BIS Board’s membership more into line with the Bank’s global role. Since 1996, the BIS has increased its membership from 36 to 55 central banks and, in the process, has raised the number of non-European and emerging market member central banks.

Directors are elected in a personal capacity. Mr Ortiz and Mr Zhou are the Governors of central banks with which the BIS has close relationships through the two BIS Representative Offices, located in Mexico City and in Hong Kong SAR. Mr Trichet, as President of the European Central Bank, has a central role in Europe and occupies an eminent position within the global central banking community.

BIS PRESS RELEASE

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Ref no: 29/2006E

26 June 2006

The BIS, globalisation and governance:

more than a decade of change

This fact sheet highlights the steps taken by the Bank for International Settlements (BIS) over recent years to strengthen its governance and to transform itself from a predominantly European institution into a global one serving the central banking community. The attached timeline lists key events in the globalisation of the BIS since 1994.

Central bank cooperation and globalisation

Since its foundation, the BIS has continuously adapted to changing circumstances in fulfilling its role of fostering effective cooperation among central banks. In the mid-1990s, the BIS began to broaden its presence across the globe, with particular emphasis on leading emerging market economies. Nineteen systemically important central banks, 17 of them outside Europe, have been invited to become BIS members since 1996, with most of the world’s major economies and financial markets represented. The BIS now has 55 member central banks.

Today’s announcement of the election of three additional members to the BIS Board of Directors reflects this wider diversity and brings the Board’s membership and the corporate governance of the BIS more into line with its global role. From 1 July 2006, the Board will be expanded to include: Jean-Claude Trichet, President of the European Central Bank, which is responsible for monetary policy in the 12-country euro zone; Zhou Xiaochuan, Governor of the People’s Bank of China (China is host country to the BIS Representative Office for Asia and the Pacific); and Guillermo Ortiz, Governor of the Bank of Mexico (Mexico is host country to the BIS Representative Office for the Americas). Directors are elected in a personal capacity.

While member central banks play a key role in the activities of the Bank, the BIS also works with other central banks and international organisations around the world in carrying out its mission to promote global cooperation.

The fact that the BIS has become a global organisation is also reflected in the diversity of its staff, who come from 48 countries.

A focus on clearer corporate governance

The BIS has worked hard to ensure that its governance is aligned with its mission and its role of serving as a focus of global cooperation among central banks.

In 2001, realising that private shareholding was not compatible with its commitment to building international financial stability, the BIS decided to repurchase privately held shares and redistribute them to central banks. This was completed in 2005. The BIS is now wholly owned by central banks.

The Board also acted last year to ensure that the BIS complies with sound corporate governance principles. Amendments to the BIS Statutes in 2005 implemented the recommendations of a panel of independent corporate governance experts (see the BIS website). These amendments abolished the role of President and established the General Manager as chief executive officer, reporting to the Board, and supported by the Bank’s Executive Committee as an advisory body.

Responding to the needs of Asia

In 2001, the Asian Consultative Council (ACC), comprising the Governors of 11 central banks in the Asia-Pacific region, extended participation of member central banks in BIS governance. The ACC advises on the work of the Asian Representative Office and was fully involved in setting out the proposals that led to an announcement of initiatives in February 2006 to expand BIS activities in Asia and deepen its relationship with Asian shareholders.

These initiatives (a three-year research programme, an extension of banking services, and an expansion of the work of the Financial Stability Institute (FSI) in the region) build on services the BIS already provides in Asia and the Pacific, and will enhance BIS understanding of policy issues that are important to central banks and supervisors in the region.

Globalisation of the BIS: a timeline:

1994

The Governors of the central banks of Canada, Japan and the United States join the BIS Board of Directors, aligning Board membership with membership of the G10. Prior to this, Board members were the Governors of the central banks of Belgium, France, Germany, Italy, the Netherlands, Sweden, Switzerland and the United Kingdom.

1996

Brazil, China, Hong Kong SAR, India, Korea, Mexico, Russia, Saudi Arabia and Singapore are invited to become BIS members.

International Association of Insurance Supervisors (IAIS) moves secretariat to BIS.

1998

BIS opens Representative Office for Asia and the Pacific in Hong Kong SAR.

First BIS Board meeting outside Basel since 1968 held in Tokyo.

Financial Stability Institute (FSI) established.

1999

First annual Special Governors’ Meeting held in Asia (Singapore), bringing together Governors from the region and from around the world.

Argentina, the European Central Bank, Malaysia and Thailand are invited to become BIS members.

Financial Stability Forum (FSF), hosted by the BIS, established.

2000

BIS opens Asia-Pacific Regional Treasury dealing room in Hong Kong SAR.

2001

BIS announces the withdrawal of all shares held by its private shareholders.

Asian Consultative Council (ACC) established.

2002

BIS opens Representative Office for the Americas in Mexico City.

International Association of Deposit Insurers (IADI) moves secretariat to BIS.

2003

Algeria, Chile, Indonesia, Israel, New Zealand and Philippines become BIS members.

First Asian Bond Fund launched.

2004

FSI Connect, an online learning resource for banking supervisors, launched.

BIS chosen to administer EMEAP’s investments in Asian Bond Fund 2.

BIS governance reviewed by a panel of independent experts.

2005

International Journal of Central Banking (IJCB) launched.

Redistribution of shares formerly held by private shareholders to member central banks completed.

BIS Statutes amended to streamline governance and enhance Board oversight.

2006

Irving Fisher Committee on Central Bank Statistics moves secretariat to BIS.

Initiatives announced to deepen BIS involvement in Asia.

Conference on central banks and development in Africa held in Basel.

The Governors of the central banks of China and Mexico, and the President of the European Central Bank join the BIS Board.

BIS Board of Directors elects three new members

Attachment:

29_2006E_new_Board_members.doc (0.05 MB), 29_2006E_fact_sheet.doc (0.06 MB)

Press, Service Press.Service@bis.org

Monday, June 26, 2006

BIS Globalization timeline

June 24, 2006