2006-09-28
1. On the Approval of Financial Reporting Standards
The Board of the Bank of Lithuania approved the forms of financial reports of banks and the Central Credit Union for supervisory purposes, which were prepared on the basis of the Guidelines on Consolidated Financial Reporting adopted by the Committee of European Banking Supervisors (CEBS).
The new financial reports were prepared in implementing Regulation (EC) 1606/2002 of the European Parliament and of the Council of 19 July 2002 on the application of international accounting standards and taking into consideration the standard reporting forms recommended by CEBS to all EU Member States.
The content of information provided in financial reports and the frequency of its provision are established so that not only the requirements of the International Accounting Standards (IAS/IFRS) with regard to information disclosure are met, but also the flow of information required from banks is optimised without increasing the burden of responsibility. Financial accounts consist of reports on the balance sheet, profit and loss, cash flows and changes in equity as well as a number of tables providing the details of the information presented in the items of the above reports. Taking advantage of the right to require additional information to the information provided in the standard reports for all EU Member States, the Bank of Lithuania prepared only one additional table, the data of which are especially important for performing advance analysis and assessment of banking activities.
A special data coding and submission system, which is currently under preparation by the CEBS, will be used for completing financial reports.
The draft financial reports were introduced to commercial banks, the Banking Association of Lithuania and international audit companies. The comments received were evaluated by the Bank of Lithuania, and the proposals that did not contradict the requirements of IAS/IFRS were taken into account.
The usage of the new financial report forms will be started when drawing up the financial reports of 2007.
2. On the inclusion of the profit for the current year in the capital of AB Bank Snoras financial group
The Board of the Bank of Lithuania allowed AB Bank Snoras to include the retained profit of the first half of the current year amounting to LTL 12.360 million in tier two capital of the bank’s financial group.
As from 30 June 2006, the amendments to the Rules for the Calculation of Capital Adequacy came into effect, which were made by the Board of the Bank of Lithuania in order to enhance the management of bank credit risk and other risks and to increase efficiency of the amortisation of this risks using own capital of the bank. The inclusion of a certain portion of the retained profit of the current year in bank capital, after deducting the taxes and dividends to be paid, is allowed only when the bank has a confirmation of the correctness of this amount by an independent audit company and upon approval of the Bank of Lithuania.