The principal changes in the Bank of Latvia's assets and liabilities on the 30 April 2007 balance sheet as compared to 31 March 2007 and the reasons for these changes.
• A decrease of 54.2 million lats or 2.1% in foreign assets as the Bank of Latvia's interventions, selling euro to banks, exceeded the amount of foreign currency obtained in currency swaps, as well as due to the decrease in the balance of the Government funds in the Bank of Latvia's foreign assets. The change in the lats equivalent of financial derivatives had an increasing effect on foreign assets.
• An decrease of 8.0 million lats or 6.4% in foreign liabilities as a result of a reduction in the lats equivalent of financial derivatives.
• A 99.5 million lats or 2.3 times rise in domestic assets, following a 98.7 million lats increase in loans granted to credit institutions.
• A rise of 36.8 million lats or 2.7% in domestic liabilities as a result of 43.9 million lats increase and a 7.0 million lats decrease in the respective balances of the credit institutions' funds and government funds with the Bank of Latvia.
• On the liabilities side of the balance sheet, the amount of lats in circulation increased by 19.6 million lats or 1.9% mainly due to the above changes.
• A decrease of 3.2 million lats in the capital and reserves as the revaluation account balance changed due to the appropriation of the Bank of Latvia's profit for 2006, securities market value and exchange rate fluctuations.
Vilnis Purvins
Head of the Macroeconomic Analysis Division
Monetary Policy Department
Bank of Latvia