Eurosystem

Background: the EMI

The European Monetary Institute (EMI) was set up under the Maastricht Treaty on 1 January 1994, coinciding with the beginning of Stage Two of European Monetary Union (EMU), as the forum for monetary co-operation between the central banks of the European Community. The EMI assumed the tasks that had previously been performed by the Committee of Governors of the central banks since 1964.

The EMI headquarters was in Frankfurt and its members were the central banks of all the Member States of the European Union (EU).

Its tasks included the following:

• To strengthen co-operation between central banks and the co-ordination of monetary policies.
• To monitor the functioning of the European Monetary System.
• To facilitate the use of the ECU and supervise its development.
• To monitor the stability of financial institutions and financial markets.
• To offer advice to Community or national bodies on any draft legislative provision that fell within the scope of its competence.
• To monitor the degree of compliance of Member States with the convergence criteria for access to EMU , and to report to the Council on the matter.

Its main objective was to contribute to EMU making all the necessary preparations in monetary matters for the transition to Stage Three. The EMI therefore specified the regulatory, organisational and logistical framework - needed for the European System of Central Banks (ESCB) to subsequently carry out its tasks.

On 1 June 1998, the EMI was dissolved when the European Central Bank (ECB) and the European System of Central Banks (ESCB) were established.