New chairman of the Committee on Payment and Settlement Systems appointed

10 May 2000

Press release

New chairman of the CPSS

The Governors of the central banks of the Group of Ten countries have appointed Mr Tommaso Padoa-Schioppa as Chairman of the Committee on Payment and Settlement Systems (CPSS) as from 15 June 2000. Mr Padoa-Schioppa will succeed Mr Wendelin Hartmann, who has chaired the Committee since 1998 and has been a member of the CPSS since its establishment in 1990. Mr Hartmann will retire on 14 June as Member of the Directorate of the Deutsche Bundesbank. Mr Padoa-Schioppa is Member of the Executive Board of the European Central Bank and has previously held the Chairmanship of the Basel Committee on Banking Supervision (1993-97) and of the Working Group on Payment Systems of the Central Banks of the European Community (1991-95).

The Governors express their appreciation for the contribution Mr Hartmann has made to international efforts aimed at reducing risks and increasing efficiency in payment and settlement systems. Under his chairmanship of the CPSS, the G10 Governors have continued to pursue their high-level strategy for reducing risks in foreign exchange settlements (see below). They have also addressed policy issues relating to wholesale and retail payment systems, published the consultative report on the Core Principles for Systemically Important Payment Systems, increased cooperation with banking supervisors and securities market regulators and established and widened cooperation with central banks outside the Group of Ten. All these activities have greatly contributed to improving financial market infrastructures worldwide.

The Governors ask the Committee on Payment and Settlement Systems, under the chairmanship of Mr Padoa-Schioppa, to continue efforts to strengthen global central bank cooperation on payment system issues.

Private sector efforts to reduce foreign exchange settlement risk

At their meeting on 8 May 2000, the Governors of the central banks of the Group of Ten countries reviewed and reaffirmed their strategy to promote the reduction of foreign exchange settlement risk. This topic is a major element of the work of the CPSS, which has primary responsibility for monitoring the progress of the strategy, with support from the Basel Committee on Banking Supervision. The Governors' discussion emphasised the primary responsibility that the strategy places on private sector market participants to follow through on their efforts to reduce significantly the systemic risks associated with settling foreign exchange transactions. In this context, the Governors regret that the private sector CLS Bank initiative has encountered delays and they encourage market participants to intensify their efforts to achieve a timely reduction of foreign exchange settlement risk.

With regard to actions by individual banks, the Governors look forward to the final release later this year of the Basel Committee on Banking Supervision's supervisory guidance on foreign exchange settlement risk. This guidance should appropriately take account of the status and potential impact of relevant industry initiatives.

Notes to editors

1. The Committee on Payment and Settlement Systems (CPSS) serves as a forum for the central banks of the G10 countries to monitor and analyse developments in payment and settlement arrangements and to consider related policy issues. Non-G10 central banks are increasingly involved in the Committee's work. The current Chairman of the CPSS is Wendelin Hartmann, Member of the Directorate of the Deutsche Bundesbank; he will be succeeded by Mr Tommaso Padoa-Schioppa on 15 June 2000. The Chairman also represents the CPSS in the Financial Stability Forum.

2. A list of CPSS publications as well as the full text of a number of recent reports are available on the BIS website at http://www.bis.org [publications]

3. The Secretariat of the CPSS is located at the Bank for International Settlements (BIS). The Head of Secretariat is Mr Gregor Heinrich.