lv

Riga 12 March 2009

The Bank of Latvia Council resolved today to reduce the Bank of Latvia refinancing rate from 6.0% to 5.0% and the marginal deposit facility rate with the Bank of Latvia from 2.0% to 1.0%. The marginal lending facility rates remain unchanged. 

The above decision was adopted in view of a continued drop in economic activity, diminishing inflation and the weak lending activity. The commercial banks are still active in using the deposit facility with the Bank of Latvia, which suggests that a reduction in the interest rate would constitute and additional stimulus for encouraging activity in the interbank lats money market and motivate the banks to direct their available resources toward lending to the economy. 

The interest rates set by the  Bank of Latvia are as follows:

 

In effect as of % per annum

Bank of Latvia refinancing rate

24.03.2009.

5.000

Bank of Latvia marginal lending facility rate to banks that have used the facility no more than 5 working days within the previous 30 day period

09.12.2008.

7.500

Bank of Latvia marginal lending facility rate to banks that have used the facility no more than 10 working days within the previous 30 day period

09.12.2008.

15.000

Bank of Latvia marginal lending facility rate to banks that have used the facility more than 10 working days within the previous 30 day period

09.12.2008.

30.000

Marginal deposit facility rate with the Bank of Latvia

24.03.2009.

1.000

The Bank of Latvia Council approved a new edition of the "Regulation for the Credit Register", "Technical Regulation for the Credit Register", and "The Amount of and Payment Procedure of the Credit Register" (all to take effect on 1 April 2009).

The changes made in the documents are mostly related to the amendments to the "Law on the Credit Institutions" that provides for a more substantial participation of the biggest non-banking sector lenders (e.g., GE Money, Nelss Līzings, Lateko Līzings) in the Credit Register. Additional improvements were made in the documents in regard to providing information to the Credit Register.

The Credit Register is an information system of the Bank of Latvia ensuring the collection, centralised accumulation and storage of data on borrowers and borrower guarantors, their obligations and performance thereof, aimed at providing information to the Credit Register participants, the Financial and Capital Market Commission, the Bank of Latvia and borrowers themselves (natural and legal persons) in compliance with the procedure stipulated by laws and regulations. 

The above Regulations will be available to all interested parties in the Legal section of the Bank of Latvia's Internet home page www.bank.lv.