Central bank balance sheet: Mirror of monetary policy – Deputy Governor Sandra Švaljek

Published: 5/9/2025

This time, the topic of the HNB Podcast is the balance sheet of central banks and the CNB asset management, which is discussed by Deputy Governor Sandra Švaljek.


Sections:

01:02
The balance sheet of a central bank shows everything it owns and owes – it is a financial recording of its situation at a given moment.
04:00
Eurosystem central bank assets serve different, but very important purposes – depending on whether they are monetary or non-monetary assets. Monetary assets are used directly to implement the common monetary policy. Non-monetary assets, on the other hand, serve to cover the operating costs of central banks and ensure their long-term viability.
04:46
At the end of 2024, the CNB assets amounted to around EUR 40bn and the portfolio of financial (non-monetary) assets managed by the CNB alone is worth more than EUR 24bn.
06:19
The CNB manages financial assets in a similar way as other market investors, but with one large and critical difference: the aim is not to maximise profits, but to preserve value and ensure investment security, high liquidity and compliance with Eurosystem rules.
11:33
The limitations stem from three main sources – the first limitation stems from the monetary financing prohibition, the second comes from the Agreement on Net Financial Assets and the last limitation relates to the ECB’s operating rules.
13:21
The CNB does not invest in stocks, cryptocurrencies, startups or any other risky investments whose price can be extremely volatile and which can bring high yields, but also high losses. On the other hand, liquidity means that the CNB must be able to obtain cash quickly.
14:34
The CNB did not accumulate gold because there was no need for it – the kuna was not an international currency and the introduction of the euro did not require physical gold reserves either. That is why the CNB does not have gold reserves, because this is not in line with the objectives of safety and liquidity.