Each day, a lot of people directly and indirectly come in contact with the Bank of Lithuania, the central bank of the Republic of Lithuania, by holding in their hands the litas, the national currency issued by the Bank, and using it to pay for goods and services.
The role of the Bank of Lithuania is very important for the country’s economy and financial system, therefore the Bank of Lithuania is included among the most important state institutions in the Constitution of the Republic of Lithuania.
Our mission: to ensure the sustainability and integrity of the state’s monetary, credit and payment systems and their stable, reliable and efficient functioning, thus creating favourable conditions for the optimal development of the national economy.
Objective: The Bank of Lithuania is the central bank of the Republic of Lithuania. Its principal objective is to maintain price stability. In seeking its principal objective, the Bank of Lithuania is independent from the Government of the Republic of Lithuania or other institutions of the state.
Litas banknotes and coins
Only the Bank of Lithuania has the right to issue and withdraw from circulation the litas banknotes and coins that end up in our wallets and are used as payment. Net litas reach the population through commercial banks. Based on the needs of the market, from the Bank of Lithuania the commercial banks regularly order a certain amount of litas and pick them up from the Bank of Lithuania’s storage facilities in Vilnius and Kaunas; when the need is reduced—the litas are returned to the Bank of Lithuania’s repositories.
Litas banknotes that are in circulation are printed by a well-known European printing. Litas and centai circulation coins are minted at the UAB Lithuanian Mint, located in Vilnius.
The Republic of Lithuania’s central bank formulates and implements monetary policy, establishes the litas exchange rate regulation system and sets the official litas exchange rate.
Lithuania applies a fixed exchange rate strategy. Due to the fixed exchange rate, in the long term it supports stable import and export prices, anchors low inflation expectations, supports increased confidence in Lithuania’s economic policy. As we know, before, the litas was pegged to the U.S. dollar, but since 1 February, 2002, it has been pegged to the euro.
The Bank of Lithuania has accumulated a large amount of foreign currency and gold reserves. Income from investment in them is allocated to ensure litas stability, to finance the activities of the Bank of Lithuania and to supplement the state budget.
Foreign reserves are safely invested only in high credit quality financial instruments in economically developed countries. A large portion of the foreign reserves (about 97%) is held in euros, while the remaining portion is made up of gold. All of the gold of the Bank of Lithuania (about 5.8 tonnes) is held at the Bank of England in London.
Supervision of banks, insurance companies, credit unions and other financial institutions
The Bank of Lithuania issues permits and licenses for the financial market participants to operate. The goal of licensing is for the country’s financial markets to be operated by reliable, transparent and financially able market participants, while their leaders would be competent and of good repute.
The Republic of Lithuania’s central bank monitors the financial market players and evaluates their compliance with the defined requirements and prudential guidelines, applying sanctions if they violate existing law. Supervision of the financial market participants aims to ensure that they have adequate capital and be liquidatable, that the risk they assume would be properly managed.
The Bank of Lithuania shall ensure that financial market participants provide services honestly, fairly and professionally, taking measures to increase the financial literacy of the public.
Investigation of disputes between consumers and financial services providers
The Bank of Lithuania impartially investigates disputes between consumers and financial services providers over insurance, lending, payment, investment and other financial services, including disputes relating to accounts, deposits in banks or other credit institutions. Having established that the financial services provider has adopted an unjustified decision, the Bank of Lithuania provides recommendations on how to settle the dispute.
Disputes between consumers and financial services providers are investigated free of charge by the Bank of Lithuania.
Payment and securities settlement systems
Safe transfers of company, institution and public funds from one bank to another, as well as other financial transactions, require a reliable payment system.
The Bank of Lithuania has developed and manages two payment systems for payments in litas. In one of these systems, payments are processed in real time, in the other—four times a day. For payments in euros to run smoothly, the Bank of Lithuania participates in the European payment system TARGET2.
Economic and Financial System Analysis, Forecasts, Statistics
The Bank of Lithuania performs analysis of the country’s economic and financial system, prepares financial stability reviews, foresees the potential threats to Lithuania’s financial system, predicts the possible economic development prospects. This information is regularly published publically.
Bank of Lithuania (Lietuvos bankas)
|Address||Gedimino pr. 6, LT-01103 Vilnius|
|Swift||LIAB LT 2X|
|Code of the Bank of Lithuania||10100|