Central Bank of B&H: Satisfactory Profit in Difficult Economic Circumstances

cb bihCentral Bank of B&H in the first six months of 2013, despite the extremely difficult circumstances, managed to make a profit in the first half of this year of the amount of 26,116 thousand KM.

This profit is lower by 7.02% compared to the same period of last year. Last year the profit was 28,087 thousand KM.

This level of the profit was primarily influenced by achieved profits based on sales of financial papers, said Central Bank of B&H regarding to financial report.

On the other hand, there are achieved significantly lower compensation expenses on deposits from commercial banks, and the policy of rationalization of operating costs implements further internal economy measures.

 The Central Bank has made in the first half of 2013 net interest income of 14,679 thousand KM compared to 16.469 thousand KM in the first half of 2012.

On the operations of the Central Bank of Bosnia and Herzegovina has heavily influenced the current situation in the European financial markets.

Foreign exchange markets, money and capital markets are still economically weak, despite an announcement that triggered optimism that the Euro zone could emerge from the recession.

The referent interest rate of the European Central Bank for the period May 8th to June 30th, 2013 was reduced to 0.50%, while the interest rate on overnight deposits remained at 0% for a period 01/01/-30/06/2013 reflecting the decline in interest rates on the money market.

During the first six months of 2013 in the financial markets have continued the fluctuations of the gold prices, as well as the exchange rate of  EUR / USD, which is reflected in the financial indicators of the Central Bank, which resulted in continuation to adjust and improve the investment process and rationalizing costs.

The average rate of effective profit on investing financial papers available for sale is 0.71% (in the first half of 2012. 1.04%). The average rate of effective profit on investments held is 1.11% (in the first half of 2012. 1.18%).

When it comes to monetary gold, its value on 30th  June 2013 was of amount 177,014 thousand KM, representing 96,000.000 ounces of gold at the value of 1.844 KM per ounce (as of 31 December 2012 value amounted to 158,979 thousand KM, representing 64,000.000 ounces of gold at the value of KM 2,484 per ounce ).

The bank holds monetary gold at the bank account in Switzerland of credit rating of AAA (Fitch), but actually it is located in the vault Bank of England.

The exchange differences on net gain is reduced this year, of 2,625 thousand KM in comparison to 4,061 thousand KM from the same period last year. Operating expenses amounted to 15 103 thousand KM and are increased by considering that in the same period last year amounted to 13,970 thousand KM. This is due to the influence of administration and other operating costs (including the cost of production of banknotes), while staff costs are slightly reduced.



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