The principal changes in the Bank of Latvia's assets and liabilities on the 31 August 2008 balance sheet as compared to 31 July 2008 and the reasons for these changes.
- An increase of 46.9 million lats or 1.6% in foreign assets due to the increase in income from debt securities and the equivalent of financial derivatives. Whereas the decrease in the amount of the funds deposited by the Latvian Government had a decreasing effect on foreign assets.
- An increase of 50.2 million lats or 46.8% in foreign liabilities as a result of a change in the lats equivalent of financial derivatives and the foreign exchange rates.
- A drop of 34.9 million lats or 2.0% in domestic liabilities as a result of 38.6 million lats and 4.1 million lats decreases in the respective balances of the credit institutions' funds and other financial institutions' funds with the Bank of Latvia. The Government deposits held by the Bank of Latvia increased by 8.4 million lats.
- On the liabilities side of the balance sheet, the amount of lats in circulation increased by 14.8 million lats or 1.5% mainly due to the above changes.
- An increase of 16.6 million lats in the capital and reserves as the revaluation account balance increased due to securities market value fluctuations and retained earnings of the reporting year grew.
Vilnis Purvins
Head of Macroeconomic Analysis Division
Monetary Policy Department
Bank of Latvia