lv

Press Release of July 16, 1998

On July 16, 1998, the Council of the Bank of Latvia resolved to introduce the 500-lats banknotes as of July 20 (see information disseminated to the press) and approved two normative documents: "Regulation on Compiling Information about Non-Bank External Payments" and "Regulation on the Security of Bank Information Technology".

The Council of the Bank of Latvia approved "Regulation on Compiling Information about Non-Bank External Payments", which was worked out in collaboration with the Central Statistical Bureau of Latvia. The regulation will come into effect as of November 1, 1998. It was developed with the participation of experts from Latvian banks as well as the central banks of Germany and the Netherlands. The largest associations of traders, manufacturers and exporters registered in Latvia, large export companies, the Ministry of Finance and the Ministry of Economy were provided with an opportunity to study the draft regulation.

One of the most important tasks that a country faces in the field of statistics is the compilation of the balance of payments. Since at the outset of the Latvian state none of other state institutions had experience in dealing with a wide range of statistical data sources, the Central Statistical Bureau of Latvia was entrusted with the task. International practice, however, shows that the compilation of the balance of payments usually pertains to the activities of a central bank. Hence, in October 1996, the Bank of Latvia and the Central Statistical Bureau of Latvia reached an agreement that it would be judicious for the Bank of Latvia in close cooperation with the Central Statistical Bureau of Latvia to compile the balance of payments.

The Bank of Latvia will take over the balance of payments with the aim of compiling and publishing it in accordance with the following requirements of international organizations:
1) Prepare and publish the monthly balance of payments within one month. (Presently, the balance of payments is published once a quarter.)
2) Prepare and publish the quarterly balance of payments within three months. (Presently, it is published within four months after the end of the reporting period.)
3) Significantly reduce net errors and omissions.
4) Improve data coverage in the respective publications on the balance of payments.

The transferal of the responsibility for the balance of payments to the Bank of Latvia can be divided into two stages. During the first stage, the Bank of Latvia will widen the range of statistical data to be included in the balance of payments, by collecting information on external payments of resident non-banks. In the future this information will be of great importance in compiling the balance of payments. During the second stage, the Bank of Latvia will gradually take over the compiling of the balance of payments from the Central Statistical Bureau of Latvia.

"Regulation on Compiling Information about Non-Bank External Payments" refers to the first stage. It stipulates the ways of obtaining statistical information on resident non-bank external payments, i.e. payments between a resident and a non-resident, necessary to compile the balance of payments. The adoption of this regulation will provide for a wider scope of information, as well as improve and speed up the compilation of the balance of payments. In accordance with the regulation, as of November 1, 1998, the Bank of Latvia will collect information on those external payments of a resident non-bank that exceed LVL 1 000 when translated into lats in accordance with the Bank of Latvia foreign exchange rates as on the date of payment. Information will be supplied both by banks and their customers (residents) who are involved in foreign economic activity. Bank customers will make their contribution in compiling the balance of payments by encoding the aim of a payment in accordance with "Classification of External Payments".

"Regulation on the Security of Bank Information Technology" approved by the Council of the Bank of Latvia supersedes "Regulation on Information Systems of Banks" that was approved on July 11, 1996 as recommendations. The Councils' resolution envisages that banks and branches of foreign banks licensed by the Bank of Latvia draw up a plan for implementing the regulation by December 31, 1998. The new regulation was adopted because banks increasingly use information technologies. It lays out principles for the maintenance, development and control of bank information systems that ensure safe and continuous performance of the systems as well as provide for the security of information and technical resources owned by banks.