ایجاد ارتباط بین داشتن توانایی مالی و استقلال بانک های مرکزی اروپای شرقی و مرکزی، ترکیه و کشورهای مستقل مشترک المنافع

Two prominent cases of quasi-fiscal operations, sterilized interventions and the accumulation of junk assets due to indirect financing of the government, can impair the financial soundness of central banks and thereby also independence. This is analyzed for selected central banks in Central and Eastern Europe and the CIS countries and for Turkey. The article concludes that sterilization costs tend to be more important in new EU member countries, whereas junk assets play a more vital role on central banks’ balance sheet in Turkey and in some CIS countries.

Central banks regularly publish financial statements, in particular balance sheets and income statements. While financial statements generally serve as a means by which management accounts for its financial performance, the main objective of central banks is not to maximize profits but to accomplish public goals such as price stability. However, because financial statements of central banks give information on their financial soundness, they can also provide information on independence. The availability of own financial resources enables the central bank to perform its tasks and a recapitalization typically leads to protracted and often convoluted negotiations between central banks and national treasuries. A growing literature has taken account of these weaknesses to central banks’ balance sheets, recently for example several contributions to the Bank for International Settlement (2003), Bindseil et al. (2004), Gros (2004), Ize (2005) or Stella (2003). Avoiding losses and, ultimately, a recapitalization by the government is indispensable for central bank independence. A dramatic example of recapitalizing a central bank occurred in the Philippines in 1992, when a new central bank was established in order to have a clean start after the previous one had incurred large bad debts. Stella, 1997 and Stella, 2002 and Dalton and Dziobek (2005) analyse more cases of central banks in emerging market countries, which made chronic losses or even needed to be recapitalized and Vaez-Zadeh (1991) discusses the implications. Quasi-fiscal operations are important factors impairing the financial soundness of a central bank. In this article, the analysis of quasi-fiscal operations of central banks concentrates on two prominent cases, (1) the accumulation of junk assets due to indirect government financing and (2) sterilized interventions in foreign exchange markets (Hawkins, 2003). Junk assets are here defined as assets that bear substantial credit risk because the central bank regards repayment and/or interest service as doubtful. Usually these assets bear a rate of return below market rate or even below the current inflation rate and occasionally central banks have already deducted provisions. Accumulating junk assets often takes place due to the participation in restructuring the financial system. It is a form of indirect financing of the government, because without the support of the central bank, the government would have to show these costs in its budget and eventually in the level of public debt. Other channels of indirect government financing are rescheduled government debt or classified loans to state-related banks or enterprises. Because the accumulation of junk assets signals indirect financing of the government, it also carries information on the degree of central bank independence from public sector financing, even though direct central bank lending is often formally prohibited or seriously restricted according to central bank statutes. Sometimes, the accumulation of junk assets has originated from periods in which the central bank has had a lower degree of statutory independence or in which financial crises forced the central bank in its role as a lender of last resort. However, a truly independent central bank should be able to gradually decrease the amount of junk assets. If it is not able to do so, it can signal a lack of bargaining power of the central bank in negotiations with the national treasuries. Sterilization costs, as defined by MacKenzie and Stella (1996), arise from operations to sterilize capital inflows by using open market operations and other market-based monetary instruments. If central banks are confronted with high capital inflows and are unwilling to permit either an exchange rate appreciation or an induced and possibly inflationary increase in base money, they will engage in sterilized interventions. Thus, sterilized interventions signal the desire to pursue two goals at the same time, an exchange rate target and internal price stability. A (hidden) conflict between the central bank and the government can lie behind the desire to pursue these two goals, if the central bank is primarily responsible for internal price stability and the government is interested in a particular exchange rate policy in order to protect some groups or sectors of the economy. Sterilization through such market-based means as the sale of a government or central bank security has a direct fiscal cost, the difference between the interest cost paid by the central bank and the interest earned on the foreign assets acquired with the foreign exchange purchased. Central bank losses from this source also reflect the trend to indirect rather than direct methods of monetary policy. MacKenzie and Stella (1996) furthermore argue, that sterilization operations bear additional, though less transparent, indirect fiscal costs, because they can be seen as altering market prices both in the foreign exchange market and the money market. The exchange rate will be less appreciated than otherwise and domestic interest will be higher. Without sterilized interventions, earners of foreign exchange would obtain less local currency for their income and spenders of foreign exchange would pay less local currency. Holders of domestic debt would be rewarded with a lower interest rate and they would receive capital gains, measured in foreign currency terms, while holders of foreign assets would suffer capital losses. Thus, sterilization operations, even though they involve voluntary transactions of market participants, carry a myriad of implicit transfers of income due to the government-influenced constellation of relative prices. In this respect, it is similar to a government policy that stabilizes the price of a commodity through purchases and sales at market prices. Weak financial statements that are burdened with the results of quasi-fiscal operations not only signal a lack of independence and thereby impair the credibility of a central bank. They also reduce its transparency, because they not only hide government debt, but they also make balance sheets less understandable to the public. A central banks’ financial strength is thus interlinked with independence, credibility and transparency (e.g. Blejer and Schumacher, 1998, Courtis and Mander, 2003, Stella, 2002 or Sullivan, 2000). This article sheds some light on two prominent cases of quasi-fiscal operations of central banks, the accumulation of junk assets and sterilized interventions. It concentrates on central banks in emerging market economies in Central and Eastern Europe, Turkey and the Commonwealth of Independent States (CIS). The group of countries in Central and Eastern Europe comprises central banks in new EU member countries (the Czech Republic, Hungary, Poland, the Slovak Republic and Slovenia) and EU accession states (Croatia, Romania, Turkey) apart from those that have opted for fairly fixed exchange rate regimes and thereby restricted themselves to only one policy goal, exchange rate stability (the Baltic states and Bulgaria). The group of CIS countries comprises all central banks that regularly publish financial statements on the internet and/or disclose sufficient information in the financial notes (therefore, Belarus, Tajikistan, Turkmenistan and Uzbekistan are excluded). The article starts with an analysis of the balance sheet structure of these central banks and investigates to what extent these central banks have accumulated so called junk assets on behalf of the government. In Section 3 it then looks at the relationship between the share of junk assets in a central banks’ balance sheet, its degree of independence and its success in fighting inflation. In Section 4 the article analyses how sterilization costs affect the central banks’ income from seigniorage and it concludes in Section 5.

The article explores weaknesses to the financial soundness of central banks in Central and Eastern Europe, Turkey and CIS countries arising from two factors: (1) the share of junk assets in central banks’ balance sheets and (2) the impact of sterilization costs on seigniorage. Analyzing weaknesses to the financial soundness can be important for judging the degree of independence of a central bank, because a financially weak central bank lacks sufficient financial resources to cover its expenses. Furthermore, a large share of junk assets may indicate that the central bank has been less independent to withstand quasi-fiscal operations with which the government has transferred public debt on the central bank balance sheet and still has not enough bargaining power to resolve the issue. Differences between the two factors impacting on the financial soundness of central banks seem to depend on different stages of transition. Central banks of the new EU member countries are in an advanced stage of transition. Their balance sheets are fairly clean regarding junk assets, however, sterilization costs weigh heavily on their financial performance even when interventions in the foreign exchange markets have stopped years ago, as for example in Poland. Net interest revenues and valuation changes are less able to compensate sterilization costs. In contrast to the past, these central banks are now confronted with valuation losses on their foreign exchange portfolio and a reduction of minimum reserve requirements together with remuneration of minimum reserve balances has decreased net interest income. Thereby, seigniorage has been further reduced or has even become negative. In contrast sterilization costs still play a minor role for fiscal seigniorage in many central banks in CIS countries and EU acceding and candidate countries. Even if significant sterilization costs arise, most of these central banks can still compensate sterilization costs by valuation gains. However, junk assets play a more important role at the Central Bank of Turkey and at some central banks in CIS countries. These assets have offered the government a way to “park a problem” at the central bank without making it transparent in the budget and finally in the measurement of government debt. Junk assets can put a burden on central bank independence, because they reveal quasi-fiscal financing to the government even though direct financing is prohibited in their central bank statutes nowadays. Furthermore, they create ongoing discussions with the Ministry of Finance on how to deal with them. Compared to independence indicators that are solely based on the institutional design of central banks, the share of junk assets as an alternative indicator shows a closer link to inflation. This leads to the conclusions that traditional indicators of central bank independence may have lost their significance, since central banks have “learnt their lesson”, at least on paper and that junk assets could provide an important missing link on this topic.