parti: objectives and features of the new reporting system 159 - TARA

statistical reporting by institutions to the Bank. The new reporting system permits
for the first time, the compilation of a number of different monetary aggregates on a
proper conceptual basis In addition, by identifying inter-institutional items
separately, it facilitates the derivation of wider monetary aggregates While a
definitive series of such aggregates must await the extension of the basis of the new
reporting system to other financial institutions, the availability of inter-institutional
items permits the computation of more accurate series such as M2H. In fact the
Bank's forthcoming Annual Report includes a wider monetary aggregate which
extends M3 to include deposits at other financial institutions. In my role as a
financial statistician, I consider it important to facilitate the derivation of as wide a
range of monetary aggregates as possible While the Bank has had to opt for
particular aggregates for policy purposes, this will be subject to review, especially
when sufficient observations are available to facilitate statistical tests
The exclusion of non-resident deposits from the series at present adopted by the
Bank has been raised There has been some speculation regarding the authenticity
of some of those deposits, but no hard evidence has been forthcoming Our statistics
and enquiries indicate that the countries of origin of these deposits have extensive
expatriate Irish communities and that the extent of lodgements from abroad is
supported to some extent by the number of cheques/drafts passing through the
banks' clearing systems. The currency composition of non-resident deposits, and
the extent of Irish-pound deposits, in particular, has been instanced in the media as
evidence that such deposits must be bogus However, unlike the situation in other
countries, it is not possible for non residents to open foreign-currency accounts at
branches of Associated Banks throughout the country, such facilities are available
only at head offices or so-called "foreign or international branches" in Dublin The
number of Irish people, relative to the size of the population of the Republic, either
living or working periodically abroad, is significant, so we should not be surprised at
the existence of a large amourit of non-resident deposits Incidentally, the growth of
such deposits is not a recent phenomenon. Supplementary data available m the
Bank indicates that the growth was also significant at times during the 1970s We
must be careful not to draw too many conclusions fiom developments in a series for
which published data are available for only a few years
The separate identification of inter-institutional items in a Supplement to the new
Monthly Bank Return will be of assistance in the compilation of flow-of-funds data
The proposed change to the basis on which other financial institutions report data to
the Bank to make them comparable with the new monthly reporting system for
licensed banks should also facilitate the compilation of such data flows. A new
quarterly sectoral distribution return, covering both deposits and lending, is also
under consideration within the Bank.
2 Continuity of Series: Any developmental work on statistics raises a continuity
issue. However, I doubt if there is anyone here who would consider continuity of
data series more important than the relevance of the data themselves Nevertheless,
for those concerned with continuity, it is proposed to continue to update for some
time, and make available on request, the old money supply and credit series. It is
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