Eesti Pank Bank of Estonia Eesti Pank Annual Report 2008 2009 © Eesti Pank, 2009 Address Estonia pst 13 15095 Tallinn Estonia Phone +372 6680 719 Fax +372 6680 836 E-mail [email protected] Web site www.bankofestonia.info Subscriptions for publications of Eesti Pank Phone: +372 6680 998 Fax: +372 6680 954 E-mail: [email protected] ISSN 1406-1414 Executive editor: Kadri Põdra Design: Vincent OÜ Layout: Urmas Raidma Printed in Aktaprint 2 CONTENTS CONTENTS ........................................................................................................................................ 3 MAiN features and Functions of Eesti Pank ..................................................................... 9 MAiN features and Functions of Eesti Pank ..................................................................... 9 Foreword by Governor of Eesti Pank .............................................................................................. 12 AccountabiliTy .......................................................................................................................... 16 Legal framework for accountability and compulsory publications of the central bank .................. 16 Accountability vis-à-vis the Riigikogu ......................................................................................... 16 Regular reporting on economic policy views and publication of economic data .......................... 17 STrATEGiC ObJECTiVES FOr PErFOrMiNG THE MAiN FuNCTiONS OF EESTi PANk ......... 20 I Monetary policy ....................................................................................................................... 20 II. Financial stability .................................................................................................................... 20 III Meeting cash demand ........................................................................................................... 20 IV. Joining the euro area ........................................................................................................... 20 V. Organisation and cooperation ................................................................................................ 21 90 AASTAT EESTi PANkA ............................................................................................................... 24 Algus 90 aastat tagasi ............................................................................................................... 24 Iseseisva Eesti riigi esimesed maksevahendid, esimene oma raha .............................................. 24 Ettevalmistused rahareformiks – raamistiku uuendamine ............................................................ 25 Majanduskriis ............................................................................................................................ 25 Sõja- ja okupatsiooniperiood ..................................................................................................... 26 Eesti Panga taasasutamine, krooni uus tulek ............................................................................. 27 Nelja mehe ettepanekust edasi… .............................................................................................. 27 Supervisory Board and Executive Board of Eesti Pank in 1919–2009 ......................................... 28 Uue Eesti krooni kattevara ......................................................................................................... 30 1992. aasta rahareform ............................................................................................................. 31 Eesti rahasüsteemi põhialused ja areng taasiseseisvuse ajal ....................................................... 31 Eesti Panga käsutuses olevad rahapoliitika instrumendid ........................................................... 32 KRONOLOOGIA: RAHAPOLIITILISE RAAMISTIKU ARENG TAASISESEISVUSPERIOODIL .............. 34 KRONOLOOGIA: PANGANDUSE ÕIGUSRAAMISTIK JA REGULATSIOON ..................................... 44 MONETARY POLICy ....................................................................................................................... 56 ECONOMIC ANALYSIS, FORECAST AND RESEARCH AS THE BASIS FOR MONETARY AND FINANCIAL POLICY-MAKING .......................................................... 57 Monitoring ................................................................................................................................. 57 Economic reviews ..................................................................................................................... 57 Economic forecast .................................................................................................................... 57 Economic research.................................................................................................................... 58 RESERVE MANAGEMENT ............................................................................................................. 59 Structure of foreign exchange reserves ...................................................................................... 59 Investment process ................................................................................................................... 59 Results and determinants of investment in 2008 ........................................................................ 60 Changes in the benchmark portfolio in 2008 .............................................................................. 60 Asset management services provided to the public sector ........................................................ 61 3 Eesti Pank Annual Report 2008 ENSURING FiNANCiAl STABILITy ................................................................................................ 62 Financial sector analysis and financial stability assessment ........................................................ 62 Measures adopted to ensure financial stability ........................................................................... 63 Amendments to EU legislation on banking and payment intermediation ..................................... 64 Improvement of securities market ............................................................................................. 65 infrastructures ........................................................................................................................... 65 Payment and settlement systems oversight ............................................................................... 65 dEVElOPMENTS iN STATiSTiCS ................................................................................................... 67 One of the key responsibilities of Eesti Pank is to compile Estonia’s balance of payments statistics and monetary and financial statistics. ..................................................... 67 Banking and other financial statistics ......................................................................................... 67 Balance of payments statistics .................................................................................................. 68 General economic statistics ....................................................................................................... 69 PAyMENT ANd SETTlEMENT SySTEMS, ANd CURRENCy iN CIRCULATiON ......................... 70 Development of the payment and settlement environment ......................................................... 70 MEETING THE CASH DEMAND ..................................................................................................... 73 Banknotes and coins in circulation and their structure ................................................................ 73 Expert analysis and handling of cash ......................................................................................... 74 Preparation of new banknotes and coins ................................................................................... 75 OrGANiSATiON ANd COOPErATiON ........................................................................................... 76 INTERNATIONAL COOPERATION .................................................................................................. 76 Cooperation with European Union institutions ............................................................................ 77 Role of Eesti Pank after the adoption of the euro ....................................................................... 80 Cooperation with the International Monetary Fund ..................................................................... 81 Cooperation with the Bank for International Settlements ............................................................ 84 Cooperation with rating agencies............................................................................................... 84 INTERNAL COOPERATION ............................................................................................................ 84 PUBLIC RELATIONS AND COMMUNICATION................................................................................ 86 Principles of informing the public ............................................................................................... 86 Media relations and public appearances .................................................................................... 86 Celebration of the 90th anniversary of the Republic of Estonia ................................................... 87 Birth of the Republic of Estonia and busts of government members ..........................................