Meeting of the Board of the Bank of Lithuania
1. The Board discussed the results of the inspection of the Agricultural Bank of Lithuania carried out from February 3 to March 14, 2003.
The on-site inspection established that on 31 January 2003 the Bank complied with all prudential requirements; its capital adequacy was 13.5 per cent, liquidity 36 per cent, maximum open position in foreign exchange was 20.5 per cent of eligible bank capital, maximum exposure was 20.9 per cent of eligible bank capital and large exposure was 207.9 per cent of eligible bank capital.
The inspection noted some shortcomings in the management of accounts and its compliance with the International Accounting Standards. The Bank was requested to remove such shortcomings.
2. The Board approved a decision setting the regulations for using banknote and coin images.
In accordance with the decision, banknote images can only be used for promotional, educational and other purposes, without an express permission of the Bank of Lithuania, on one-sided copies whose size is at least 125 per cent or at most 75 per cent of the real length and width of a respective banknote. The size of double-sided copies has to be at least 200 per cent or at most 50 per cent of the real length and width of a respective banknote. Images of coins can be replicated on different materials with the exception of metals.
The purpose of the above decision was to make banknote images better distinguishable from the original banknotes and avoid situations when such images could be confused with real banknotes.
3. The Board discussed the results of stress testing.
The purpose of stress testing was to assess the impact of credit, market, liquidity and operational risks on banks. The testing showed that banks were capable of facing key risks. This was the first time such testing was carried out. In the future it will be conducted on a periodical basis.
4. The Board decided to give permission to Bank Snoras, Hansa-LTB, Parex Bank, Sampo Bank and the Agricultural Bank of Lithuania to register amendments in their statutes.
The amendments were aimed at aligning them with the provision of the Civil Code of the Republic of Lithuania and the Company Law of the Republic of Lithuania. In addition, following the registration of amended statutes, the Board decided to replace the licenses of Hansa-LTB and the Agricultural Bank of Lithuania to indicate the new names of the banks as Hansabankas and NORD/LB Lietuva.
5. The Board approved the model of the 200 litas commemorative coin marking the 750th anniversary of the crowning of Mindaugas and the 50 litas commemorative coin featuring Vilnius Cathedral (series “Historical and Architectural Monuments of Lithuania”).
The coin marking the crowning of Mindaugas will be the first Lithuanian bimetallic commemorative coin made from gold and silver. The coin will be issued at the end of the second quarter of 2003. The coin featuring Vilnius Cathedral will be the second in the series of commemorative coins “Historical and Architectural Monuments of Lithuania”. The coin will be issued at the end of the third quarter of 2003.
6. The Board decided not to change the date of the entry into effect of the Rules for Managing the Loan Risk Database.
The amendments to the Rules for Managing the Loan Risk Database, approved on 14 November 2002, will enter into effect as from 1 October 2003. The amendments provide for the inclusion of a wider scope of indicators in the Loan Risk Database allowing the banks themselves as well as supervisors performing qualitative and quantitative assessment and forecasting of credit risks.
The issue on the date of entry into effect of the Rules was discussed on the basis of the proposal from the Lithuanian Banking Association to postpone the date.
The decision not to change the above data was taken on the grounds that the date was previously coordinated with commercial banks and a period of 11 months was left for making the necessary preparations for implementing the requirements of the Rules.