Banking. Functions of the Central Bank of Russia (lecture notes)

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Banking. Functions of the Central Bank of Russia (lecture notes)

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Functions of the Central Bank of Russia

The Federal Law of April 12.04.95, XNUMX established the main functions and operations of the Central Bank of the Russian Federation:

The function of conducting the state monetary policy on the development of a market economy, ensuring the stability of monetary circulation and the purchasing power of the national currency. In fulfilling this function, the Bank takes part in the development of the foundations of the government's economic policy and uses various methods of monetary management of the banking system that fall within its competence.

Function of issuing money and organizing money circulation. The issue of money is a monopoly right of the Central Bank and is solely within its competence. CBs do not have the right to independently issue funds into circulation. The need to issue new money is determined by the realization of national income or the newly created value of the total social product.

The function of lending to commercial banks based on refinancing the portfolio of their resources. The main feature of this function is that the Central Bank, as a “bank of banks,” provides lending only to banking institutions. The lending process consists of restoring the funds of grassroots banks invested in the capital circulation of enterprises in various sectors of the national economy. Loans are provided at refinancing rates established by the Central Bank.

Function of organizing non-cash payments in the national economy. When performing this function, the “bank of banks” establishes the principles of organizing settlements, methods of making payments, forms of forms of monetary documents, stages of their accounting processing and the procedure for performing settlement transactions.

Function of organizing banking operations, accounting and statistical reporting on the work of banks. In connection with this function, the Bank creates rules for financing, lending, settlements and cash transactions, as well as accounting and reporting for the main areas of activity of credit institutions.

Function of state registration of credit institutions. In fulfillment of this function, the Bank reviews the package of documents for opening a new credit institution and decides to grant a license for the right to conduct banking operations. Such licenses are issued only to credit institutions that have qualified personnel to perform the duties assigned to them.

Function of organizing state control over the activities of credit institutions. After the opening of credit institutions and the start of their operations, the Central Bank exercises constant control over their activities. This work is carried out by the bank's cash settlement centers, which house correspondent accounts of lower-level credit authorities. By analyzing the turnover and cash balances on these accounts, RCCs receive the necessary information about the liquidity, solvency and financial condition of the commercial bank.

Function of selling government bonds. loans and crediting of federal budget expenses. The Central Bank is the authorized body of the Ministry of Finance of the Russian Federation for the sale of government bonds. The bonds of these loans are sold by dealer banks, the composition of which is formed by the Ministry of Finance and the Central Bank.

The function of regulating the country's gold and foreign exchange reserves. The Central Bank of the Russian Federation is the main depository of the state's gold and foreign exchange reserves and organizes all operations for the sale and purchase of gold and foreign currencies. Transactions with these values are carried out at supply and demand prices in the gold and foreign exchange markets.

Function of compiling a country's balance of payments. In the context of the detronization of gold, the liquidation of the gold coin standard and monetary parity, the basis for backing the Central Bank banknotes are commodity masses, including goods of domestic and foreign production. In order to control the state of foreign trade, payments and gold and foreign exchange reserves, the Central Bank of the Russian Federation compiles the balance of payments of the Russian Federation.

Author: Shevchuk D.A.

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