ANNUAL REPORT 2008 - Polymer Bank Notes of the World

3 OPERATIONAL ASPECTS OF THE INTEGRATIONOF NÁRODNÁ BANKA SLOVENSKA INTOTHE EUROSYSTEMFollowing the ECOFIN Council’s decisionof 8 July 2008 on the adoption of the euro bySlovakia on 1 January 2009, the ECB conductedtechnical preparations with a view to fullyintegrating Národná banka Slovenska into theEurosystem. In line with the provisions of theTreaty, Národná banka Slovenska joined theEurosystem with exactly the same rights andobligations as the NCBs of the EU MemberStates that had already adopted the euro.The technical preparations for the integration ofNárodná banka Slovenska into the Eurosystemcovered a wide range of areas, notably financialreporting and accounting, monetary policyoperations, foreign reserve management andforeign exchange operations, payment systems,statistics and banknote production. In the fieldof operations, preparations involved extensivetesting of the instruments, procedures andtechnical systems for the implementationof monetary policy and foreign exchangeoperations.3.1 MONETARY POLICY OPERATIONSFollowing the adoption of the euro by Slovakiaon 1 January 2009, 26 Slovak credit institutions,a list of which is published on the ECB’swebsite, became subject to the Eurosystem’sreserve requirements as from that date. Theentry of Slovakia into the euro area changedthe liquidity conditions in the Eurosystem onlyslightly. The aggregate reserve requirements ofeuro area credit institutions increased by lessthan 0.5% (€740 million). Net autonomousliquidity factors in Slovakia for the period from1 to 20 January 2009 were liquidity-providing,reducing the liquidity needs of the entire euroarea banking sector by €7.21 billion on average.This liquidity-providing effect occurred despitethe fact that the liquidity-absorbing monetarypolicy operations launched by Národná bankaSlovenska before entering the euro area, whichmatured between 6 and 13 January 2009,were also treated as autonomous factors, aswere debt certificates issued by the centralbank which matured on 20 January. Takingall of these factors into account, the entry ofSlovakia into the euro area reduced the totalliquidity needs of the euro area banking sectorby €11 billion, roughly equal to 1% of aggregateliquidity needs.Given the liquidity surplus, counterpartiesfrom Slovakia submitted bids for relativelysmall amounts in the open market operationsconducted at the beginning of 2009: €1 millionin the main refinancing operation which settledon 14 January, and €15 million in both the threemonthand the six-month longer-term refinancingoperations which settled on 8 January.On entering the euro area, Národná bankaSlovenska also adopted the collateral frameworkof the Eurosystem and reported €17.6 billionin assets located in Slovakia which wereeligible for Eurosystem credit operations as of1 January 2009.3.2 CONTRIBUTION TO THE ECB’S CAPITAL,RESERVES AND FOREIGN RESERVE ASSETSUpon joining the ESCB on 1 May 2004,Národná banka Slovenska paid up 7% of itsshare of the subscribed capital of the ECB asa contribution to the ECB’s operational costs.In accordance with Article 49.1 of the Statuteof the ESCB and the legal acts adopted by theGoverning Council on 31 December 2008,Národná banka Slovenska paid up the remainingpart of its subscription on 1 January 2009. Itstotal subscribed share amounts to €39.9 million,equivalent to 0.6934% of the ECB’s subscribedcapital of €5.761 billion as at 1 January 2009.At the beginning of 2009, in accordance withArticles 30 and 49.1 of the Statute of theESCB, Národná banka Slovenska, on the basisof its share of the ECB’s subscribed capital,transferred to the ECB foreign reserve assetsequivalent to a total of €443.1 million (85% ofwhich was in US dollar-denominated assetsand 15% in gold). Národná banka Slovenskahas opted to conduct the operational activitiesrelated to the management of its share of theECBAnnual Report2008143