The Riksbank’s balance sheet
The Riksbank’s balance sheet shows the Riksbank’s various assets and liabilities. The assets are largely managed within the framework of the Riksbank's financial asset management. The Riksbank's assets consist mainly of securities in Swedish kronor and the gold and foreign exchange reserves.
The Riksbank’s financial assets and liabilities
The Riksbank's assets and liabilities
Securities in Swedish kronor – the Riksbank's largest asset
The Riksbank manages financial assets to ensure that it can fulfil its statutory objectives and perform its tasks. The Riksbank’s expansionary monetary policy in recent years has meant that most of the assets comprise securities in Swedish kronor. Since February 2015, the Riksbank has used purchases of Swedish government bonds as a tool to make monetary policy more expansionary. During the coronavirus pandemic, the Riksbank also purchased Swedish treasury bills, covered bonds (mortgage bonds), municipal bonds and corporate bonds. The assets also include the Riksbank’s loans against collateral to monetary policy counterparties.
Another large part of these assets are made up of the gold and foreign currency reserves. These ensure that the Riksbank, if necessary, can supply temporary liquidity support in foreign currency and intervene on the foreign exchange market. The foreign currency reserves consist of debt securities in foreign currencies with high liquidity and low credit risk, primarily government bonds.
Assets also include claims on the International Monetary Fund (IMF). The Riksbank stands prepared to use its gold and foreign currency reserves to lend money to the IMF, which, in turn, lends money to countries with balance of payment problems. Part of the Riksbank's claims on the IMF are the Special Drawing Rights (SDRs) allocated by the IMF to the Riksbank. An amount corresponding to the SDRs allocated by the IMF is reported as a liability on the Riksbank's balance sheet.
The Riksbank’s other assets consist of the Riksbank’s premises at Brunkebergstorg, shares in the Bank for International Settlements (BIS) and other holdings.
The banks’ investments in Monetary Policy Instruments – the Riksbank’s greatest liability
The Riksbank’s financial liabilities mostly consist of deposits in Swedish kronor – the banking system’s liquidity surplus in Swedish kronor in relation to the Riksbank. Banks that are monetary policy counterparties to the Riksbank may deposit liquidity surpluses with the Riksbank via monetary policy instruments in the form of standing deposit facilities overnight and Riksbank Certificates with a maturity of one week. When the Riksbank adds liquidity to the banking system in Swedish kronor, a debt to the banks arises in the form of an increased liquidity surplus. The banks place the surplus as deposits with the Riksbank. These deposits have increased in recent years as a result of the Riksbank also purchasing Swedish securities. Through the purchases, the Riksbank has added a large amount of liquidity to the banking system and thereby increased the banks’ liquidity surplus in relation to the Riksbank.
The Riksbank also has financial liabilities in foreign currencies to the Swedish National Debt Office. These liabilities consist of US dollars and euros that the Riksbank has borrowed via the Swedish National Debt Office in order to fund the foreign currency reserves. At the beginning of 2021, the Riksbank decided to replace the loans from the Swedish National Debt Office with deposits in Swedish kronor from banks. The Riksbank purchases foreign currency on the foreign exchange market at a steady pace over a longer period of time and pays for the purchases in Swedish kronor. This means that the banks’ deposits in Swedish kronor increase on the Riksbank’s balance sheet. At the same time, the Riksbank repays the currency loans through the Swedish National Debt Office as they mature. This will give the Riksbank self-financed foreign currency reserves. (Read more about the financing of foreign reserve assets “Self-financing of foreign reserve assets is completed earlier”.)
The Riksbank issues the banknotes and coins that are used in Sweden. The value of banknotes and coins in circulation is reported as a liability on the balance sheet.
The major part of the Riksbank’s profit is transferred to the Treasury. The part of the profit retained by the Riksbank has been aggregated over the years and forms the Riksbank’s equity. As yet unrealised profits are balanced against what is known as the ‘revaluation account’, which forms a part of the Riksbank’s equity.