"The global economy and financial system have shown enormous resilience in the face of successive shocks over the last year," said the Bank for International Settlements (BIS) in releasing its Annual Report today. However, the Bank also pointed out that there were still considerable risks and uncertainties affecting the economic outlook.
The Report was released following the BIS's Annual General Meeting in Basel, Switzerland. Nout Wellink, Chairman of the Board of Directors and President of the Bank, in addressing representatives of more than 100 central banks and international institutions, emphasised that it was essential to remember that financial markets had continued to perform well and a deep recession had been avoided during the last, very difficult, year.
Nevertheless, Wellink drew attention to the risk that an abrupt correction in some overvalued asset prices could weaken or delay the recovery and put some strain on the financial system. He said the recent demise of several large corporations after the discovery of accounting irregularities underscored the need for effective measures to improve corporate reporting. He also stressed the importance of structural reforms in achieving stronger and sustainable growth in all major economies.
Andrew Crockett, BIS General Manager, reporting on the activities of the Bank, commented on its increasingly global character. This, he said, is reflected by both the range of its central bank customers and the bodies involved in cooperative efforts towards greater financial and monetary stability, several of whose secretariats are hosted by the BIS. In this context, Crockett cited continued progress on the New Basel Capital Accord and the opportunity for enhanced regional cooperation created by the forthcoming opening of the Bank's Representative Office for the Americas in Mexico City.
The Bank reported an audited Balance Sheet totalling 87,714.4 million gold francs at 31 March 2002, and a net profit of 225.7 million gold francs after deduction of costs of administration (1 gold franc = 0.29032258... grams of fine gold, or US$ 1.94149..., converted at US$ 208 per ounce of fine gold).