The Riksbank’s balance sheet
The Riksbank’s balance sheet show the Riksbank’s various assets and liabilities.
The Riksbank's assets and liabilities
31/12/2018, SEK billions
The gold and foreign currency reserve – the Riksbank's greatest asset
The gold and foreign currency reserve makes up more than half of the Riksbank's total assets. This allows the Riksbank to offer emergency liquidity assistance in foreign currency and to influence the krona exchange rate by buying and selling currency. The reserve is also used when the Riksbank lends money to the IMF.
The Riksbank's monetary policy assets consist of securities issued by the Swedish government in Swedish kronor. This item has grown substantially since 2015 due to the purchases of government bonds initiated by the Riksbank at that time for monetary policy purposes.
Claims on the IMF arise when the Riksbank lends money to the IMF. The IMF, in turn, lends money to developing countries and to countries in financial crisis.
The Riksbank's other assets consist of the Riksbank's premises at Brunkebergstorg, shares in the Bank for International Settlements (BIS) and other holdings.
Banks' use of monetary policy instruments – the Riksbank's greatest liability
The Riksbank's financial liabilities mainly consist of the liability in SEK arising when banks deposit some of their liquid assets at the Riksbank. This item has grown substantially since the beginning of 2015 when the Riksbank started buying Swedish government bonds for monetary policy purposes.
The Riksbank also has liabilities in foreign currencies to the National Debt Office. These consist of US dollars and euros borrowed by the Riksbank from the National Debt Office in 2009 and 2012 in order to strengthen the currency reserve. The reason was that experience from the financial crisis in 2008-2010 showed that the reserve held by the Riksbank at that time had not been sufficient to cope with the crisis and hence guarantee financial stability and to fulfil commitments made to the International Monetary Fund (IMF).
Monetary policy liabilities refer to the Riksbank certificates issued by the Riksbank and what are known as "fine-tuning transactions".
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 Riksbank's balance sheet.
The main share 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.
Regulatory framework for asset management
The Riksbank has a regulatory framework for asset management: a financial risk policy. In this policy, the Executive Board sets the framework for the risks that may be taken in the management of the foreign currency reserve. It also details how the managers are to identify, measure, manage, monitor and report these risks.
The policy is complemented by risk regulations. The different types of risk considered are credit risk, market risk and liquidity risk.
Every year, the Executive Board also decides on an investment policy for asset management. Among other matters, this investment policy regulates the size of the gold reserve and how many US dollars and euros the foreign currency reserve is to contain.