According to the report, "Practical Issues Arising from the Introduction of the Euro", banks are well on course for the introduction of the euro on 1 January 1999. But "preparations amongst many fund managers and insurers appear rather less advanced".
John Townend, deputy director at the Bank of England, explained that, until now, many fund managers and insurers have relied on banks to take the lead in euro preparations. "They [the fund managers and insurers] need to start thinking for themselves," he said.
Mr Townend also stressed the importance of preparing for the "Euro Big Bang", the so-called "conversion weekend". Between 31 December 1998 and 4 January 1999, debt issues of countries participating in the first wave of monetary union, as well as some cash accounts, will be converted into euros.
The Bank wants key players in the conversion weekend to start testing their systems by the end of September next year, at the very latest. And it emphasised yesterday that all firms operating in London's wholesale securities market "need to understand in detail how the conversion weekend is expected to work, to minimise the risk of confusion and error".
The Bank said: "The conversion weekend will be like a simultaneous Big Bang at the wholesale level throughout the European Union, and it is essential that the euro gets off to a good start".
Institutions' resources are being stretched by the dual challenge of preparing for the euro and the year 2000, according to the report.
The Bank yesterday gave its official seal of approval to Chaps euro, a real-time gross settlement system, which will, from 1999, run in parallel with the existing Chaps sterling settlement system.