OREANDA-NEWS. November 21, 2011. Taking into account the holding downward impact of domestic demand on inflation and there has appeared a number of other factors with predictably downward pressure on inflation, the Bank of Latvia Council resolved to leave unchanged both the interest rates set by the Bank of Latvia and the mandatory reserve requirement for the banking sector, reported the press-centre of Bank of Latvia.

In recent months the trend of abating inflation has become evident with only the raising of several tax rates preventing a more rapid drop in prices: raised taxes have accounted for one third of this year's inflation. As the global prices of energy resources and food are stabilizing and assuming that the Government will refrain from raising any taxes, a substantial drop in inflation can be predicted for next year. Domestic demand is growing slowly and represents no risk of rising prices; moreover it is becoming likely that economic growth in Latvia will be slower next year as the demand in external markets drops because of the global debt crisis.

The Report of the Governor of the Bank of Latvia, Ilmars Rimsevics, at today’s press conference will be available in the news section of the Bank of Latvia’s home page www.bank.lv .

The Bank of Latvia Council approved amendments to the "Regulation for the Credit Register", which will take effect on 25.11.2011. (some items on 01.02.2012.). The amendments have been made to streamline the procedure for entering and editing the Credit Register data if a Credit Register participant loses its participant status, as well as the procedure for providing the Credit Register data to persons.

The Credit Register is a Bank of Latvia information system that ensures gathering of information on borrowers and their guarantors, about their liabilities and their discharge; centralized storage and safekeeping with the aim of providing information to the participants of the Credit Register, the Financial and Capital Market Commission, the Bank of Latvia and borrowers themselves (natural and legal persons) according to the procedure provided for in the laws and regulations.

The Bank of Latvia Council  approved amendments to the "Procedure for Participation in the Interbank Automated Payment System" and "Procedure for Participation in the System TARGET2-Latvija", to take effect on 21.11.2011.

The amendments were made to include procedures that would ensure actions by the Bank of Latvia and system participants in the Bank of Latvia maintained payment systems SAMS and TARGET2-Latvija in cases where the European Union (EU) introduces administrative or restrictive measures (e.g., EU sanctions against a third country). In addition, amendments to TARGET2-Latvija will provide the Bank of Latvia with the possibility to suspend, limit or terminate a participant's access to its intraday credit if it is considered that participant poses risks on the grounds of prudence, i.e. based on these considerations that are taken into account when the Eurosystem suspends the participation of an institution in the monetary operations on the grounds of prudence.

The Bank of Latvia interbank automated payment system (SAMS) functions as a centre of the entire lats payment system, ensuring the mutual settlements of large scale interbank payments and the settlements of the Bank of Latvia's monetary operations as well as performs end settlements of other payment systems.  SAMS is Bank of Latvia's real time gross settlement system that provides for interbank settlements in lats in real time.

The euro payment system TARGET (abbreviation of the Trans-European Automated Real-time Gross settlement Express Transfer System) is a real-time payment system, which central banks of the EU being participants of the European Monetary Union  utilize along with the European Central Bank (Eurosystem) to carry out a common monetary policy and promote a smooth function of the euro payment system. The EU banks use this system for financial market settlements as well as large-scale and urgent payments of clients. The Bank of Latvia with its TARGET2-Latvija provides its participants with an effective, fast and safe infrastructure for payments in euro, using for settlements the euro deposits of participants with the Bank of Latvia.
The Bank of Latvia Council approved amendments to the "Regulation for Compiling the Monthly Financial Position Report of Monetary Financial Institutions", to take effect on 01.01.2012.

The amendments were made to ensure harmonization with the European Central Bank's new Regulation No. 883/2011, which provides for new identification criteria of money market funds and adjusts the definition of monetary financial institutions. According to the amendments, the electronic money institutions that are principally engaged in financial intermediation in the form of issuing electronic money, are to be included in the category of monetary financial institutions.
The "Regulation for Compiling the Monthly Financial Position Report of Monetary Financial Institutions" provides for the procedure for compiling and submitting the Monthly Financial Position Report with regard to monetary financial institutions.