In the context of European economic integration, 1992 is a watershed. By the end of the year, separate national financial systems will have been integrated into a single EEC-wide market for financial services. The papers collected in this volume provide a comprehensive analysis of the challenges and opportunities implied by this integration for Europe as well as for the global financial system. Renowned specialists in international finance examine issues such as the welfare gains to EEC countries from the integration process, the impact on financial institutions in non-member countries, the consequences for established and emerging financial centers, the stability of the world financial system, and the required changes in regulation and supervision. Most of the authors agree that '1992' will generate significant efficiency gains both inside and outside the EEC. These gains from liberalization of financial markets will not necessarily fall uniformly across existing financial institutions and financial centers, however. Some existing institutions will undoubtedly experience difficult adjustment problems even if the tendency for the financial industry as a whole will be positive. New financial centers will challenge the dominance of the existing ones. The analysis contained in the volume also suggests that increased competitive pressures in the financial markets may bring about greater market volatility, and it discusses how supervisory authorities must respond in order to maintain the resilience of the world financial system.