Highlights from the Central Bank of Iceland balance sheet

The following data are from the Central Bank of Iceland's Balance Sheet as at the end of October 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 increased by 5.4 b.kr. and amounted to 51.7 b.kr. at the end of October (equivalent to 680 m. US dollars at the exchange rate at the end of the month). The Bank now has no foreign short-term liabilities in connection with its foreign reserves; at the beginning of the year these liabilities amounted to just over 16 b.kr.

In October, the Central Bank purchased currency in the domestic interbank market for 4.4 b.kr., which is consistent with the measures to strengthen its external position as described inter alia in the May 2003 issue of the Bank's Monetary Bulletin. The Icelandic króna weakened by 0.3% in October.

Market value of listed securities in the Bank's portfolio was 3.9 b.kr. at the end of October. Of this figure, listed Treasury securities amounted to 0.7 b.kr., decreasing by 0.5 b.kr. during the month when an issue matured.

Central Bank claims on deposit money banks decreased by 11.4 b.kr. in October and amounted to 44.3 b.kr. at the end of the month. Claims on other financial institutions remained virtually unchanged at 3.2 b.kr.

Net claims on central government increased by 11.6 b.kr. in October and the Treasury's net deposit at the end of the month stood at 16.5 b.kr.

Base money increased by 5.8 b.kr. during the month and amounted to 37.4 b.kr. at the end of October.

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

No 25/2003
6 November 2003

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: Deposits in foreign currency accounts in the Central Bank. 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, net: 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.