04/08/2021 | Press release | Distributed by Public on 04/08/2021 05:39
Today, on 8 April, the Bank of Lithuania transferred €16.63 million to the state budget from its 2020 profit. This is the largest amount allocated by the central bank since 2012.
Decisions on profit distribution are adopted by the Board of the Bank of Lithuania in accordance with the Republic of Lithuania Law on the Bank of Lithuania.
'Last year, as a result of COVID-19, not all euro area central banks managed to achieve positive profitability and thus contribute to the state budget. Being proud of the Bank of Lithuania's investment performance in 2020, I would like to emphasise that this year we will further seek ways to boost the central bank's financial capacity and, at the same time, its contributions to the national budget,' said Gediminas Šimkus, Chairman of the Board of the Bank of Lithuania.
Pursuant to the set of financial statements for 2020 approved by the Board of the Bank of Lithuania, the central bank's profit in 2020 amounted to €24.64 million, compared to €25.44 million in 2019.
The Bank of Lithuania generates the bulk of its profit from management of financial assets, customer services as well as participation in the Eurosystem and monetary policy operations. The investment allocation method used by the Bank of Lithuania helped weather the storm that battered financial markets last year.
The Bank of Lithuania must submit its set of annual financial statements, accompanied by an auditor's opinion, to the Seimas of the Republic of Lithuania and make it public within four months after the end of each financial year.
Following the Republic of Lithuania Law on the Bank of Lithuania, the amount allocated to the state budget after the allocation of profit to the Bank of Lithuania's reserve capital shall not exceed 70% of the calculated average of the Bank of Lithuania's profit (loss) of the last three financial years. Contributions to the state budget shall be paid once a year, usually by 1 May.
In recent years, the share of funds allocated by the Bank of Lithuania to the national budget has been steadily growing.
The central bank's contribution to the state budget in 2019 amounted to €13.8 million, in 2018 - to €12.7 million, while in 2017 - to €11.2 million.
In addition to the set of financial statements, the Board of the Bank of Lithuania has also approved the central bank's Annual Report for 2020 as well as the Report on the Implementation of the Primary Objective of the Bank of Lithuania, the Situation of the Financial Market and Performance of the Bank's functions.