Reserve requirement

Reserve requirement is an instrument of the NBRM's monetary policy, which obliges the banks and savings houses to allocate funds on the accounts with the central bank.  Main functions of the instrument are stabilization of the short-term interest rates on the money market, managing the money supply and the level of credit multiplication and reduction of the structural excess liquidity.

Banks' reserve requirement base is determined as an average of the liabilities for each day of the calendar month that precedes the fulfillment period. The saving houses' reserve requirement base for three consecutive fulfillment periods is determined as an average of the liabilities for each day of the last calendar month in the quarter that precedes the first of the three fulfillment periods.

Banks' reserve requirement in Denars is a sum of the amount calculated from the liabilities in domestic currency, the amount calculated from the liabilities in domestic currency with FX clause and 30% of the amount calculated from the liabilities in foreign currency. In determining the reserve requirement in Denars, the base for the banks' reserve requirement against their liabilities in domestic currency is reduced by the amount of the claims based on newly approved loans to non-financial companies and investments in debt securities in domestic currency issued by non-financial companies[1]. Banks fulfill the reserve requirement in Denars on average basis. Banks' reserve requirement in foreign currency is 70% of the amount calculated from the liabilities in foreign currency. Banks' reserve requirement in foreign currency is allocated on special FX accounts of the NBRM abroad, and it is fulfilled in Euros at a fixed level. Savings houses fulfill the reserve requirement on special accounts with the NBRM at a fixed level.

The reserve requirement fulfillment periods are specified in the Indicative calendar of fulfillment periods of Denar and Euro reserve requirement for banks and saving houses.

Banks' reserve requirement ratios are presented in the table below:

Liabilities	Reserve requirement ratio	Applied as of:
-      in domestic currency	10%	11.01.2005
-      in domestic currency with FX clause	20%	11.07.2009
-      in foreign currency	13%	11.08.2009
Exception:
-      liabilities to natural persons with contractual maturity of over two years	0%	11.01.2012
-      repo-transactions in domestic currency	0%	11.01.2012
-      liabilities based on issued debt securities in domestic currency with original maturity of at least two years	0%	13.02.2012

Reserve requirement ratio of savings houses equals 2.5%.

The remuneration ratios are presented in the table below:

Reserve requirement	Remuneration rate	Applied as of:
-      in Denars	1%	11.01.2012
-      in Euros	0.1%	16.10.2009

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[1] Non-financial companies - net exporters and/or non-financial companies that use the funds to finance projects for domestic production of electricity, for own and/or commercial purposes.

Decision on reserve requirement
Decision on amending the Desicion on reserve requirement
Data on reserve requirement
Indicative calendar of fulfillment periods of reserve requirement for 2013