Contents Preface and acknowledgements 1 Financial integration between the EU and the economies of Central and Eastern Europe: an overview David G. Dickinson and Andrew W. Mullineux PART I MONETARY AND EXCHANGE RATE POLICY 2 Monetary policy and economic development in transitional economies Maxwell J. Fry 3 The Czech approach to inflation targeting Miroslav Hrncÿ’rÿ and Katerÿina Sÿm’dkov‡ 4 The link between FEER and fiscal policy in a transitional period: the case of the Czech economy Katerÿina Sÿm’dkov‡ 5 Interest rate policy and inflation behaviour in the Czech Republic: from exchange rate to inflation targeting Eric Girardin and Nicholas Horsewood 6 Latvia on the way to the European Union: economic policy convergence Inna Sÿteinbuka 7 Monetary policy prospects and Maastricht criteria in Lithuania before accession to the EU Salomeúja Jasinskaiteú, Dalia Vidickieneú and Rasa Melnikieneú 8 The currency board regime in Bulgaria and its sustainability Tatiana Houbenova 9 EMU convergence criteria and international flows of capital: the dilemmas for Polish macroeconomic policy Boguslaw Grabowski and Jerzy Pruski 10 The Asian financial crisis and lessons for CEE economies David G. Dickinson and Andrew W. Mullineux 11 Joining EMU as an irreversible investment David G. Dickinson and Jean-Baptiste Desquilbet PART II FINANCIAL SECTOR DEVELOPMENT 12 Financial stability and economic development in transitional economies Maxwell J. Fry 13 Payment systems and economic development in transitional economies Maxwell J. Fry 14 Mobilization of savings in transition countries: the case of Lithuania Dalia Vidickieneú, Salomeúja Jasinskaiteú and Rasa Melnikieneú 15 The Polish banking sector and EU regulations Andrzej Raczko 16 Banking sector restructuring and debt consolidation in the Czech Republic Roman Matousÿek 17 Market efficiency in transition economies: equity markets and EU accession Nicholas Horsewood and Douglas Sutherland 18 Risk and optimal interest margins: the case of commercial banks in Central Europe Daniel Goyeau, Alain Sauviat and Amine Tarazi 19 The impact of market structure and efficiency on bank profitability: an empirical analysis of banking industries in Central and Eastern Europe CŽline Gondat-Larralde and Laetitia Lepetit 20 Convergence between the financial systems of EU member states and applicant transition economies Victor Murinde, Juda Agung and Andrew W. Mullineux Index