NATIONAL BANK OF ROMANIA

BNR is a public institution, created as an effect of an organic law. More then 100 years ago. The law, dated on April 17th 29th 1880, for the setting up of a discount and emission bank, under the name of Romanian National Bank, offered the exclusive privilege of this institution to issue the Romanian state currency. Since the beginning, BNR was all the time the only emission bank, even if its economical functions the property regime or the institutional dimensions were altered significantly and sometime radically. BNR was created as a joint stock company with an initial capital of lei 12 mil. gold. Only the third part from this share capital was state property while the rest belongs while the rest belongs to individuals, whose interests were strong linked with the liberal upper bourgeoisie. The organic law from 1991, confirm that BNR has a share capital of 5 billion, entirely state owned, that property regime being considered by the legislators more proper for the new functions of the bank (planned as in case of west central banks with an authentic functional and decisional independence). Today, BNR is not a usual bank because, regard credit operations, the bank make transactions only with the state represented by the budget authority and the financial institutions. On the other hand, BNR is subordinated to the government; it is an institution that independently manages the public stocks, having specific economical and social changes. BNR keeps its own accounting based on generally accepted commercial principles, the bank having the possibility to close its activity on profit or, on the contrary, with losing. In spite of this, in all these years since 1880, the bank has never registered damages. The profit is imposed by the Finance Ministry, as an income to the state budget. The net income is distributed, according to the Romanian law, by the Executive Board of the bank, which is named and subordinated to the Romanian Parliament.

The first and the most important economical and social change of BNR consists in supplying the monetary circulation in the whole country, with treasury note and metallic coin. The monetary values emission of the Romanian state is, by law, the monopoly of the BNR. From physical and valuable point of view the issue is permanently and the number of treasury notes and metallic coins being in circulation are the result of their putting in and backing out. The treasury notes and metallic coins value represents the most important position from the BNR liabilities balance sheet. As regard the assets of the bank, there are three types as are the following: loans granted to the banking companies; loans for the budget of the state; loans granted to abroad (from the country gold reserve or currency reserve administrated by BNR). These three important categories of assets are in correspondence with three monetary functions of BNR: the bank of the banks; cashier and banker of the state budget; administrator of the international means of payment reserve of the country (gold and foreign currency). Globally, all these functions along with other specific legal disposals in the payment field, cash or not offers to BNR the competence to establish and control the monetary currency, loan and payment policy of the country. In other words, BNR is the monetary authority of the state, supporting its daily administration of the economical affaires by the government. In addition to the functions of monetary authority, BNR is also payments author because both the cash payments and the most majority of transfers are running in its own branches network (which has the role of agent for the commercial banks in the process performed by these banks for their clients). In order to accomplish its specific responsibility of central bank for the Romanian state, BNR has two companies subordinated, with technological profile in the processing industry.

Thus, Regia Autonom Imprimeria Naional makes the banknotes printing, under very safety conditions, for the moment right in the BNR head office. The Regia Autonom Monetria Statului processing precious or usual metal to obtain both monetary effects as metallic coins, or as those with intrinsic value, and no value monetary effects like medals. These money factories, banknotes or metallic coins, are the only two BNR participations to the activity of other companies, organized to obtain benefits. For the global interest problems, on its position of bank of the banks, BNR is in charge to issue valid rules for the banking system (and for each bank). Taking into consideration the risk, specific only for the banks institutions, that there is the possibility to coming up the situation when the clients money cannot be returned by bank, BNR is also the risk system administrator being so the guardian of the public interest. BNR carry on to search and to introduce new refinancing forms to ensure more discipline and performance for the refinancing credit demands addressed by the commercial banks, inclusive by imposing of (maximal) limits at credits level. BNR could perform compensation and discount services of the payments between banking companies, being involved both as arbitrator and as a participant in the payments systems. BNR started to organize, on its own risk and expenditure, the territorial compensation centers, utilizing its intrabanking network for the payments message transmission of the commercial banks. Such operation, that is in fact a rationalization in the technological tide of discounting, represents the object of the latest developments from BNR, in order to achieve the informatisation of the whole its intrabanking network. Also, BNR represent today the only organizer and supplier of very shortterm credits (one working day), on the Romanian market.

On its position of organizer and coordinator of the currency policy, BNR is the authority which insures the payments balance treasury of the country, inclusive by making the foreign currencies auditing. In the same time, BNR mediate the making-up of the exchange rate on interbanking market; the implementation of this policy it is not entirely in the charge and the possibilities of the central bank. Beyond (foreign) currency reserve, BNR constitute and manage directly, the precious metal reserve of the country which served as a guarantee of the domestic monetary emission and, in very critical history situations, as means of payment worldwide accepted. BNR, like the most contemporary central banks, supervise and participate to the regulation and the operation of the country payments system. Thus, since 1992, BNR has been taken the initiative of the transfer payments system reform. By doing this, BNR try to accomplish the transformation of Romania, from a cash society to an intense banking, where the majority of the payments will take place with the big support of the informatic system, by electronic payments. BNR is controlled by an Executive Board formed by nice members, delegated by Parliament, at the proposal of the prime minister, for an eight years period. From these nine members four belongs to the permanent executive structure of BNR. The others five, which are not BNR employees, have not the right to be member of Parliament, involved in justice or state administration. This majority guarantees the decision objectivity due to the fact that these five members are not formally involved in power equation or in the electing circuit. The daily administration is done by the governor which is also the executive chief naming in charge all central systems staff personnel and the branch managers. BNR has been facing the risk produced by the adjustment at new forms in its fight with the time. That risk comes not from all of us but for everyone and with the wishing that what we can see done, and what we couldnt see but it is done, to help and to survive.