2006-02-21
1. The Board of the Bank of Lithuania approved the 50 litas sample commemorative coin dedicated to the nature of Lithuania. The coin is to be issued in the first quarter of 2006.
The coin dedicated to the nature of Lithuania was designed by Rimantas Eidejus.
It depicts a lynx (Lynx lynx) which is included into the Red Book of Lithuania.
2. The Board of the Bank of Lithuania heard a report of the Bank of Lithuania Market Operations Department on the investment of foreign reserves in 2005.
The goals and functions of the Bank of Lithuania determine that foreign reserves are first of all managed following the principles of safety and liquidity and then only the principle of profitability.
At the end of the last year, the international reserves of the Bank of Lithuania stood at EUR 3,215.9 million (LTL 11,103.9 million). The income received from their investment amounted to EUR 57.4 million (LTL 198.2 million) last year.
The return on foreign reserves in 2005 reflected the priorities of safety and liquidity in foreign reserve management and low interest rates in financial markets.
With the fixed exchange rate between the litas and the euro, the Bank of Lithuania avoids currency risk by investing most of its foreign reserves in euro. Only investments of gold, the price of which is denominated in US dollars, are subject to currency risk. The value of gold managed by the Bank of Lithuania increased by EUR 21 million over the year.
3. The Board of the Bank of Lithuania heard a report of the Market Operations Department on the risk tolerance and return in the management of foreign reserves. The Board was presented an overview of the return on foreign reserves and risk characteristics in other central banks.
Alternatives of likely tolerable risk and of the return to be sought in the investment of foreign reserves were discussed in detail.
The Bank of Lithuania ascertained that the characteristics of the foreign reserve risk and return being sought continued to comply with Bank of Lithuania requirements in the field of foreign reserve investment.