1. www.debtagency.be Kingdom of Belgium - Federal Public Service FINANCE - Treasury - Debt Agency Financial Markets and Services. (FMS) 2007 Page 1 THE INTRODUCTION OF THE EURO : PUBLIC DEBT RELATED ISSUES

2. www.debtagency.be Kingdom of Belgium - Federal Public Service FINANCE - Treasury - Debt Agency Page 2 Financial Markets and Services. (FMS) 2007 PUBLIC DEBT REDENOMINATION : Overview relevant entities A.FIN EURO B.TREASURY – NBB WORKING GROUP C.TREASURY

3. 3 www.debtagency.be Kingdom of Belgium - Federal Public Service FINANCE - Treasury - Debt Agency Page 3 Financial Markets and Services. (FMS) 2007

4. www.debtagency.be Kingdom of Belgium - Federal Public Service FINANCE - Treasury - Debt Agency Page 4 Financial Markets and Services. (FMS) 2007 A. FIN EURO (2) 1.TASK Its task consists of  Analysing the impact of the single currency on the financial markets and  Drawing up recommendations for the various players in these markets. 2. ORGANISATION To this end the group divided its working to four internal cells responsible for an in-depth study of the following subjects : a.Conversion of the debt b.Quotation c.Settlement d.Relations with issuers

5. www.debtagency.be Kingdom of Belgium - Federal Public Service FINANCE - Treasury - Debt Agency Page 5 A. FIN EURO (3) : working group debt (1) A. FIN EURO (3) : working group debt (1) Financial Markets and Services. (FMS) 2007 1.Composition - All relevant organisations : financial institutions, National Bank, Stock Exchange, Clearing organisations,… - Chaired by Treasury. 2.Working method - Meetings on a regular basis with a reporting to the Fin Euro sub-group.

6. www.debtagency.be Kingdom of Belgium - Federal Public Service FINANCE - Treasury - Debt Agency Page 6 Financial Markets and Services. (FMS) 2007 A. FIN EURO (4) : working group debt (2) FOCUS ON -types of products : dematerialised debt, materialised debt, futures and options - types of issuers : public, private - calendar - consequences for data – processing systems (tests) - conversion techniques, roundings etc.

7. www.debtagency.be Kingdom of Belgium - Federal Public Service FINANCE - Treasury - Debt Agency Page 7 Financial Markets and Services. (FMS) 2007 B. TREASURY – NBB working group Composition : two co-chairs + collaborators involved depending on the subject Rationale : discuss and solve common problems : NBB is paying agent !

8. www.debtagency.be Kingdom of Belgium - Federal Public Service FINANCE - Treasury - Debt Agency Page 8 I.Link with Admi Euro group within Treasury II.Link with working group on regulation III.Internal approval of proposals Fin Euro working group, Treasury - National Bank working group and regulation working group IV.Creation of a new debt management entity: debt agency Financial Markets and Services. (FMS) 2007 C. TREASURY ( 1)

9. www.debtagency.be Kingdom of Belgium - Federal Public Service FINANCE - Treasury - Debt Agency Page 9 I. Link with Admi Euro group within Treasury Financial Markets and Services. (FMS) 2007 C. TREASURY (2) Meetings on a regular basis together with representatives of all the Treasury divisions Overall progress control.

10. C. TREASURY (3) www.debtagency.be Kingdom of Belgium - Federal Public Service FINANCE - Treasury - Debt Agency Page 10 Financial Markets and Services. (FMS) 2007 II. Link with working group on regulation Organised and chaired by a civil servant of the Ministry of Justice Co-ordination relevant legislation, regulation.

11. www.debtagency.be Kingdom of Belgium - Federal Public Service FINANCE - Treasury - Debt Agency Page 11 Financial Markets and Services. (FMS) 2007 C. TREASURY (4) III. Internal approval of proposals Fin Euro working group, Treasury-National Bank Working group and regulation working group Debt Committee: precursor of the current Strategic Committee for the Debt Composition: chaired by the Head of the Treasury (see further).

12. www.debtagency.be Kingdom of Belgium - Federal Public Service FINANCE - Treasury - Debt Agency Page 12 Financial Markets and Services. (FMS) 2007 C. TREASURY (5) IV. THE CREATION OF THE DEBT AGENCY A.RATIONALE : allow the public debt management to : Answer to the competitive pressure existing between large issuers of the euro zone; Adjust its modes of intervention on the debt securities market, not only as to the organisation and management of the primary market, but especially as regards its strategy and operations on the secondary markets – a new activity possible since the appearance of the large euro market; Adapt to the formidable changes seen by the finance management sector since the beginning of the nineties; Obtain more flexibility in the management of human resources since the agency’s staff comprises both civil servants pertaining tot the Treasury affected tot the agency, and employees under contract recruited to face the specific needs described above.

13. C. TREASURY (6) www.debtagency.be Kingdom of Belgium - Federal Public Service FINANCE - Treasury - Debt Agency Page 13 Financial Markets and Services. (FMS) 2007 IV. THE CREATION OF THE DEBT AGENCY B. ORGANISATION Establishment of the agency in october 1998, integrated to the Ministry of Finance as a specialised department of the Treasury; Responsible for formulating strategy and all operational aspects of public debt management; It comprises three departments, working in close co-operation : front office, which acts as a trading room and supervises the PD & RD activity ; middle office, which develops the management strategy, controls risks, develops the marketing activity and takes care of the budget; back-office, which confirms, processes and records the transactions initiated by the trading room while providing it support. An Executive Committee does preparatory work for decisions made by the Strategic Committee, chaired by the Administrator General of the Treasury and which includes, a.o., a person representing the Minister of Finance.

14. www.debtagency.be Kingdom of Belgium - Federal Public Service FINANCE - Treasury - Debt Agency Page 14 C. CONTROL Parliamentary control : the agency remains under the general control exerted by the Court of Audit. The parliamentary sub-commission of finance is being kept abreast of important evolutions either on its request or by initiative taken by the minister; Political control : exerted by the Minister of Finance when adopting the “General guidelines”, which contain the strategy and the framework governing the debt management operations. Moreover, a representative of the minister is member of the Strategic Committee (cf above); Internal control : the afore mentioned Strategic Committee takes the important decisions within the framework of the General Guidelines. As such it is in charge with the supervision of the day-to-day management of the agency. In addition, a specific internal auditor has been appointed. Financial Markets and Services. (FMS) 2007 C. TREASURY (7) IV. THE CREATION OF THE DEBT AGENCY

15. www.debtagency.be Kingdom of Belgium - Federal Public Service FINANCE - Treasury - Debt Agency Page 15 Financial Markets and Services. (FMS) 2007 ▶ THANK YOU