Highlights from the Central Bank of Iceland Balance Sheet

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The following data are from the Central Bank of <'xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />Iceland's Balance Sheet as at the end of June 2003 with comparative figures for the end of December 2002 and changes within the month and from the beginning of 2003.

The Central Bank's foreign reserves remained virtually unchanged and amounted to 36.9 b.kr. at the end of June (equivalent to 483 m. US dollars at the exchange rate at the end of the month). Foreign short-term liabilities decreased by 5.5 b.kr. during the month and amounted to 4.3 b.kr. at the end of June.

In June, the Central Bank purchased currency in the domestic interbank market for 3.5 b.kr., which is consistent with the measures to strengthen its external position as described inter alia in the May issue of the Bank's Monetary Bulletin. The Icelandic króna weakened by 4.3% in June.

Market value of listed securities in the Bank's portfolio was 4.3 b.kr. at the end of June. Of this figure, listed Treasury securities amounted to 1.2 b.kr.

Central Bank claims on deposit money banks declined by 3.4 b.kr. in June and amounted to 62.8 b.kr. at the end of the month. Claims on other financial institutions increased marginally to 8.0 b.kr. at the end of the month. 

Net claims on central government rose by 1.4 b.kr. in June and the Treasury's net deposit at the end of the month stood at 24.5 b.kr.

Base money increased by 1.7 b.kr. during the month and amounted to 34.4 b.kr. at the end of June.

For further information, contact the Governors of the Central Bank of Iceland and Erla Árnadóttir, Chief Accountant, tel. (+354) 569-9600.

Definitions

Foreign reserves: Total currency assets of the Central Bank. Foreign exchange: The Central Bank's deposits with foreign banks and its foreign securities portfolio. Reserve position in the IMF: Net reserve in the IMF. Listed securities, Treasury: Assets in the form of Treasury bonds, Treasury bills and Treasury notes. Listed securities, Other: Housing bonds and housing authority bonds. Claims on DMBs: The Bank's net claims on deposit money banks. Claims on other financial institutions: Net claims. Foreign short-term liabilities: Occasional short-term borrowing by the Central Bank, for purposes including to strengthen its foreign reserves. Notes and coin: Total notes and coins in circulation outside the Central Bank. Sight deposits of DMBs and other financial institutions: Deposits in current accounts with the Central Bank. Required reserves of DMBs and other financial institutions: Reserves that these institutions are obliged to maintain with the Central Bank in accordance with requirements set by the Bank.

Memorandum items. External reserve, net: Foreign current assets less foreign current liabilities. Claims on central government: i.e. liabilities of these entities towards the Central Bank less their deposits with it. Other claims, total: Total claims on other institutions than central government. Base money: Notes and coin in circulation, and deposits and reserves of DMBs with the Central Bank.

No. 20/2003

4 July 2003