Tuesday, April 30, 2013

Central bank finances, by David Archer and Paul Moser-Boehm

By David Archer and Paul Moser-Boehm

BIS Papers No 71
April 2013
This paper looks at the relevance of a central bank's own finances for its policy work. Some central banks are exposed to significant financial risks, partly due to the environment in which they operate, and partly due to the nature of policy actions. While financial exposures and losses do not hamper central banks' operational capabilities, they may weaken the effectiveness of central bank policy transmission. Against this backdrop, the paper analyses the determinants of a central bank's financial position and the possible implications of insufficient financial resources for policymaking. It also provides a conceptual framework for considering the question of whether central banks have sufficient financial resources.

JEL classification: E58, E61, G01, M41

Title Languages
  Foreword EN
  Overview and conclusions EN
  Introduction EN
  Part A: Preliminaries: understanding central bank finances EN
  Part B: What financial resources do central banks have? EN
  Part C: What level of financial resources do central banks need? EN
  Part D: Assessing the appropriate amount of financial resources - a framework EN
  Annex 1: Central bank accounting policies EN
  Annex 2: Components of selected distribution schemes EN