The Reserve Bank made an $111 million loss in the June 2010 year because of unrealised losses arising from revaluations of its assets and liabilities, its annual report says.
The loss compares with a $906 million profit in the previous year.
Reserve Ban
The Reserve Bank made an $111 million loss in the June 2010 year because of unrealised losses arising from revaluations of its assets and liabilities, its annual report says.
The loss compares with a $906 million profit in the previous year.
Reserve Bank governor Alan Bollard said most of the losses occurred on the bank’s unhedged foreign exchange position, as exchange rate and interest rate movements partially reversed the large unrealised gains of the previous year.
“While our reserves are still showing a positive return based on purchase costs, we foreshadowed in the 2009 annual report the likelihood of volatility in accounting profit and loss,” he said.
The bank made a dividend payment to government of $290 million for the 2010 year.
“This leaves the bank with equity of $2,574 million, a strong base for the potential risks inherent in our activities and large balance sheet,” Dr Bollard said.
