lv
Created on 13.09.2012

In view of the fact that risks for price stability in the medium term are limited and inflation continues to go down as well as the expected negative influence of the European debt crisis on the Latvian economy, the Bank of Latvia council today resolved to reduce interest rates set by the Bank of Latvia:

-          the Bank of Latvia refinancing rate from 3.0% to 2.5%;
-          the bank overnight deposit facility with the Bank of Latvia interest rate from 0.10% to 0.050%;
-          the bank seven-day deposit facility with the Bank of Latvia interest rate from 0.125% to 0.075%;
-          the marginal lending facility interest rates:
  • for the facility used no more than for five working days in the previous 30 days from 4.0% to 3.0%,
  • for the facility used no more than for 10 working days in the previous 30 days from 7.0% to 6.0%,
  • and for the facility used for more than 10 working days in the previous 30 days from 10.0% to 9.0%.

The easing of the monetary policy conditions conducted subsequent to the lowering of Bank of Latvia interest rates in March and July will provide the banks with an additional stimulus to direct available lats resources for economic development. The new lending facility interest rates will be applied to banks as of 24 September 2012. The mandatory reserve requirement set for the banks has not been changed.

The Report of the Governor of the Bank of Latvia, Ilmārs Rimšēvičs, at today’s press conference will be available in the Bank of Latvia’s home page www.bank.lv. 

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

 

In effect as of

% per annum

Bank of Latvia refinancing rate 

24.09.2012.

2.5

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

24.09.2012.

3.0

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

24.09.2012.

6.0

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

24.09.2012.

9.0

Bank of Latvia overnight deposit facility rate

 

24.09.2012.

0.050

Bank of Latvia 7-day deposit facility rate

24.09.2012.

0.075

The refinancing rate is one of the major interest rates set by the Bank of Latvia, which has an impact on the interest rate on lats resources offered by the Bank of Latvia in main refinancing operation tenders and hence also affects the interest rates on Latvia's money market. Credit institutions can also make use of standing facilities of lending and depositing of funds - borrow funds in lats from the Bank of Latvia against a securities collateral with overnight maturity and deposit funds in lats with the Bank of Latvia with an overnight and a 7-day maturity.

The Bank of Latvia Council approved the "Regulation for the Credit Register" and "Regulation for the Exchange of Electronic Information with the Bank of Latvia ", both to take effect on 01.12.2012.

In the Regulation for the Credit Register, terminology has been changed and information is grouped as required by the Law of Credit Register. The information are divided into general and periodic information, including that on the supervision of market participants and macroeconomic analysis, which will only be used for the purposes of macroeconomic analysis and supervision of market participants, as well as information on violations (delayed payments). It also provides for a procedure whereby a person and former participant in the Credit Register signs statement on the correction or annulment of information in the Credit Register so that the Bank of Latvia can correct or annul it accordingly in the Credit Register. The Regulation for the Credit Register will harmonize the amount of information to be provided for all participants in the Credit Register.

In addition, the technical requirements have been removed from the Regulation for the Credit Register; they are included in the Regulation for the Exchange of Electronic Information with the Bank of Latvia" and include a provision for technical limitations for the updating, correcting and annulling of information in the Credit Register.