Bank of Lithuania

1. The Board discussed the results of the inspection of Ūkio Bankas.

The inspection established that the Bank complied with all prudential requirements.

The assessment of assets showed a need for additional specific provisions of LTL 1,692 thousand. In addition, the Bank was instructed to reform its investment portfolio by 1 July 2004 so that its investment in real estate did not exceed 5 per cent of bank capital. This decision was passed in view of the fact that some investment was not related to activities characteristic of credit institutions, while its replacement with interest earning financial assets would have an impact on a more effective functioning of the Bank and the banking system.

2. The Board approved supplements to the Regulations on Reserve Requirements to Credit Institutions that allow commercial banks to hold required reserves not directly but through an intermediary. Such possibilities are allowed to banks whose operations are organised in a way when part of them are administered by an intermediary. In addition, the Regulations provide for calculating consolidated required reserves in banks or bank groups. This is one of the steps aimed at aligning reserve requirement regulations with the procedures of the European Central Bank.

As reflected in the practice of euro area countries, in Finland, Austria, the Netherlands, Portugal and Italy more that 50 per cent of the banks hold their reserves with an intermediary. In France, Spain and Germany such banks account for 8?17 per cent. However, in Ireland, Greece, Luxembourg and Belgium they account for less than 1 per cent.

3. The Board decided to announce the 200 litas denomination commemorative coin to celebrate the 750th anniversary of the crowning of Mindaugas legal tender and to issue the coin as from 25 June 2003. This will be the first Lithuanian bimetallic commemorative coin made from gold and silver. The mintage of the coin is 2000 pieces.

4. It was decided to make 10 thousand collectors sets of circulation coins of 2003 issue, consisting of 10, 20 and 50 centas coins and 1, 2 and 5 litas coins, at the Lithuanian Mint. The decision was based on the increased interest from Lithuanian and foreign collectors for Lithuanian commemorative and circulation coins.

The last collectors set was issued in 2000, and all of the issued 5000 items were sold.