2004-10-28
1. The Board approved the sample of the 50 litas commemorative coin by Rytas Jonas Belevicius devoted to the Couronian Spit (UNESCO World Heritage). The commemorative coin is to be issued in Q4 2004.
2. The information about the activities of domestic credit institutions and the Credit Institutions Supervision Department of the Bank of Lithuania in Q3 2004 was presented.
Overview of banking operations
According to the financial statements of banks for 1 October 2004, assets of domestic commercial banks in operation made up LTL 26.4 billion, increasing over Q3 2004 by LTL 1.2 billion, i.e. 4.9 per cent.
Loans to customers amounted to LTL 15.3 billion, increasing in comparison with 1 July 2004 by 1.2 billion, i.e. 8.4 per cent. The amount of deposits with domestic banks stood at LTL 16 billion on 1 October 2004, increasing over the reporting period by LTL 772 million (5.1 %), of which deposits of individuals made up LTL 8.9 billion, up by LTL 196 million (2.2 %).
According to the financial statements of banks for 1 October 2004, the operations of nine banks and two foreign bank branches were profitable and they earned a profit of LTL 218.2 million in the course of nine months, while one bank (UAB Sampo bankas) incurred a loss of LTL 0.9 million over the same period. The overall performance of the system of domestic banks over nine months 2004 was a profit of LTL 217.3 million (LTL 182.6 million over the respective period in 2003).
According to the data for 1 October 2004, the standard liquidity ratio of the banking system made up 41.52 per cent and exceeded by over 10 percentage points the Bank of Lithuania’s established minimum; the capital adequacy ratio stood at 12.75 per cent (the established minimum requirement is 10 per cent).
In Q3 2004 all commercial banks and foreign bank branches operating in Lithuania complied with the Bank of Lithuania’s established prudential requirements.
Operations of the Central Credit Union of Lithuania
The assets of the Central Credit Union of Lithuania (CCUL) grew by LTL 3.3 million (11.3 %) in Q3 2004 and on 1 October 2004 made up LTL 32.4 million. In Q3 three new credit unions added up to the number of the CCUL members and on 1 October 2004 the CCUL comprised 52 members. Over Q3 the CCUL earned a profit of LTL 12 thousand and the overall performance of the current year was a profit of LTL 92 thousand. Compared to the previous year, the profit of the CCUL doubled.
Overview of the operations of credit unions
On 2 October 2004, 61 credit unions operated in Lithuania. 60 credit unions, comprising over 41 thousand members, presented financial statements to the Bank of Lithuania.
In Q3 2004, the assets of credit unions grew by 9.5 per cent, loans granted - by 8.4 per cent, investment in Government securities - by 7.2 per cent, deposits accepted - by 9.9 per cent, and the share capital of credit unions - by 8.9 per cent.
Over nine months of 2004 credit unions earned a profit of LTL 628 thousand, of which LTL 234.6 thousand over the quarter under review (the profit earned during 9 months 2003 was LTL 607.2 thousand).
According to the submitted statements for 1 October 2004, all credit unions complied with the prudential requirements for credit unions.
Supervision of credit institutions
The Bank of Lithuania, taking into account the provisions contained in EU directives and the recommendations of the Basle Committee on Banking Supervision, in Q3 2004 continued supervising banks and credit unions in order to ensure their safe and sound operation and compliance with the established prudential requirements.
In Q3, on-site inspections were completed in two banks and carried out in another two banks. Also, general examinations of 6 credit unions were carried out.
The Board of the Bank of Lithuania in Q3 approved several legal acts for the regulation of licensing procedures for credit institutions. The Regulations for the Enforcement of the Right to Provide Financial Services in the Republic of Lithuania and in other European Union Member States were approved. They regulate the procedure for the establishment of branches of domestic banks and of their associated financial undertakings and/or the provision of financial services in another EU member state without establishing a branch, as well as the procedure for the enforcement of the right of foreign banks licensed in other EU member states and of their associated financial undertakings to provide financial services in the Republic of Lithuania.
The Procedure for the Issuance and Revocation of Licenses for Credit Unions was amended. It was supplemented with provisions under which the Board of the Bank of Lithuania would have the right not to issue a license where, during the examination of documents, it is established that the provisions of credit unions regarding the sizes of credit share contributions, the rights granted by a share, the competence of the bodies of credit unions, and the procedure for their appointment and recall do not ensure safe and sound operation of the credit union.
New Regulations on the On-site Inspection of Banks were developed. They regulate in more detail the relationship with foreign supervisory authorities in carrying out on-site inspections of the associated banks of foreign banks and of branches of foreign banks.
The Regulations on the On-site Inspection of Credit Unions were developed as well.
A new version of the Rules on the Consolidation of Financial Statements and on the Consolidated Supervision of a Financial Group was approved. They have established the conditions and ways for preparing consolidated statements of a financial group, the procedure for submitting consolidated statements to the Bank of Lithuania and announcing them to the public.
A new version of the General Regulations for Organising the Internal Audit in the Bank was approved to enter into force from 1 May 2005.