Developments in the domestic economy and the financial system are monitored mainly through the analysis of macro-prudential indicators and other financial data. The analysis, placed also in the context of international developments, helps in the detection of vulnerabilities in the structure and functions of the domestic financial system as well as in the identification of those international events which could lead to instabilities in the domestic system. The analysis is further supported through macro stress testing exercises meant to assess the resilience of the financial system to extreme but plausible shocks. The financial stability framework is complemented by a sound structure for managing any potential financial crisis. These processes involve the maintenance of healthy cooperation links with the domestic individual institutions and authorities concerned, and the financial markets whilst keeping close cooperation with the national central banks and financial supervisors abroad. Promoting the implementation and observance of international standards relevant to strengthening the financial system is also deemed important for the effective functioning of the financial system.

Malti