lv

Press Release of October 19, 1998

  

The Bank of Latvia Executive Board has established the following Lombard rates as of October 19, 1998: 7% annually for the first 10 days of credit use, 8% annually starting with the 11th day of credit use, and 9% annually starting with the 21st day of credit use.

 

Like other central banks, the Bank of Latvia issues Lombard credits to banks acting as the lender of last resort, and these credits are the most expensive refinancing instruments available to the banks. In October the increasing bank demand for lats contributed to a relatively rapid rise in interbank loan interest rates and the Bank of Latvia’s repo auction interest rate averages. In order to improve the structure of the interest rates for loans granted by the Bank of Latvia, the Bank has increased the Lombard rates by 1%.

The Bank of Latvia’s Refinancing and Lombard Rates in 1997 and 1998

Date Refinancing rate (%) Lombard Rates (%)
for the first 7 days starting with the 8th day starting with the 15th day
as of 06.12.1996. 9.5 11.5 13.5 15.5
as of 10.01.1997. 9 11 13 15
as of 31.01.1997. 8 10 12 14
as of 14.02.1997. 7 9 11 13
as of 28.02.1997. 6 8 10 12
for the first 10 days starting with the 11th day starting with the 21st day
as of 28.03.1997. 5 6 7 8
as of 24.04.1997. 4 5 6 7
as of 30.01.1998. 4 6 7 8
as of 19.10.1998. 4 7 8 9