EN
OPINION OF THE EUROPEAN CENTRAL BANK
of 28 March 2003
at the request of the Bank of Greece
on amendments to the Statute of the Bank of Greece
(CON/2003/4)
1. On 26 February 2003, the European Central Bank (ECB) received a request from the Bank of
Greece for an opinion on proposed amendments to its Statute. The Bank of Greece informed theECB that it would present these amendments at the general meeting of the Bank of Greecesshareholders scheduled for 22 April 2003 and, follow ing approval by such general meeting, to the
Greek Parliament for ratification.
2. In accordance with the second indent of Article 105(4) of the Treaty establishing the European
Community and the second indent of Article 4(a) of  the Statute of the European System of Central
Banks and of the European Central Bank (ESCB St atute) and the third indent of Article 2(1) of
Council Decision 98/415/EC of 29 June 1998 on the consultation of the European Central Bank bynational authorities regarding draft legislative provisions , the ECB is competent to deliver an
opinion since the provisions concern the Statute of the Bank of Greece. In accordance with the firstsentence of Article 17.5 of the Rules of Procedure of the European Central Bank, the GoverningCouncil of the ECB has adopted this opinion.
3. Most of the proposed amendments concern technical modifications to: general provisions
(Article 2), the General Council (Article 27), the Monetary Policy Council (Article 35A), accounts
and statements (Article 52), monetary policy instruments (Article 55D, Article 56 No 4 andArticle 58) and the withdrawal of banknotes denominated in drachmae (Article 68). In addition,there are several insertions related to auditors (Article 44) and the business of the bank andmonetary policy instruments (Article 55 Nos 5 and 18, Article 55B, Article 56 Nos 3 and 5). Eachparagraph below will describe the proposed amendments, explain their rationale and provide forthe ECBs views separately for each amendment. Additions to the Statute of the Bank of Greeceare underlined, whilst deletions are crossed out.
24. Section (e) of Article 2 
It is proposed that this Article read as follows:
'The main tasks of the Bank of Greece shall be to:
[]
e) promote and oversee the smooth operation and efficiency of payment systems and means of
payment, as well as of trading, settlement or clearing systems for over-the-counter (OTC)
transactions in securities and other financial instruments, in accordance with Article 55 no.
5 hereof;
[...]'
This amendment is mainly intended to establish, for reasons of legal certainty, the authority of theBank of Greece over means of payment. The ECB welcomes this clarification, which does not giverise to any specific observations from the ESCBs perspective.
5. Section (i) of Article 27
It is proposed that this Article read as follows:
'The General Council shall decide on the following matters:
[]
i) matters connected with the acquisition of immovable property required for the business of
the Bank and the temporary acquisition and sale of similar property under Article 58  under
Articles 56 n° 3 and 58;
[]'
This amendment is intended to align the General Councils authority to acquire immovable
property with the new content of the relevant substantive provisions of the Statute1. The above
arrangement is a matter internal to the Bank of Greece and does not give rise to any specificobservations from the ESCBs perspective.
6. Article 35A
It is proposed that this Article read as follows:
'The Monetary Policy Council shall be responsib le for decisions pertaining to monetary policy
definition and implementation and to the conduct of exchange rate policy, the operation and
efficiency of payment systems and means of payment  and the issue of banknotes. These tasks shall
be exercised by virtue of Acts of the said Council. 
                                                     
1See paragraphs 13 and 16 of this opinion for Article 56 Nos 3 and 58, respectively.
3[]'
This amendment is intended to align the content of this provision with that of Section (e) of
Article 2 (see paragraph 4 above). The ECBs opinion applies here mutatis mutandis  as well, i.e.
the ECB welcomes the clarification which does not give rise to any specific observations from theESCBs perspective. To avoid misunderstanding, and as already noted in the ECBs OpinionCON/00/07 of 17 April 2000 on previous amendments to the Statute of the Bank of Greece, thepowers of the Monetary Policy Council of the Bank of Greece have to be read in conjunction withArticle 2 of the Statute of the Bank of Greece. This Article recognises expressly that such powershave to be executed in the framework of and in accordance with the ESCB legal framework. 
7. Article 44
It is proposed that this Article read as follows:
'The first General Meeting of Shareholders and, subsequently, the Annual General Meeting shall
elect three qualified persons and two substitutes as Auditors, to examine and report upon thebalance sheet of the Bank to be presented at the next Annual General Meeting, and shall determinetheir fees. No Councillor or other officer of the Ba nk shall be eligible as Auditor during his term of
office. Instead of the above natural persons, the General Meeting may elect as auditors a
corporation or syndicate of Chartered Accountants.
[]'
The new wording of the provision enables the Bank of Greece to appoint not only physical personsregistered as auditors but also auditing firms that are, for example, organised as public companieslimited by shares. The ECB notes that this does not rule out the possibility, for reasons ofconvenience, of the audit provided for by the Statute of the Bank of Greece coinciding with theaudit prescribed by the Statute of the ESCB. The ECB welcomes this extension of the Bank ofGreeces choice of auditors since it reflects current auditing practice.
8. Article 52
It is proposed that this Article read as follows:
'The Bank shall draw up a statement of its assets and liabilities as at the 15th and last day of each
month, and shall publish it not later than a week after these dates  within a week.'
This provision is in accordance with the prevailing practice within the ESCB and is therefore fullysupported by the ECB.
49. Article 55 No 5
It is proposed that this Article read as follows:
'The business of the Bank shall be restricted to the following operations. The Bank, acting in
accordance with the provisions applicable each time in the ESCB legal framework, may:
[]
5. establish operating rules and oversee payment systems and settlement systems for over-the
counter transactions, with a view to ensuring the efficiency and soundness of these systemsand in particular to reducing systemic risk and strengthening competition; the Bank mayalso manage such systems without prejudice to the rules applicable each time in the ESCBlegal framework. Moreover, it may set rules and oversee the operational reliability and legal
safety of means of payment with a view to safeguarding their efficiency.
These systems shall include systems for netting, se ttlement and clearing of payments, as well as
systems for the settlement and clearing of over-the counter transactions in securities, in physical orbook-entry form, and other financial instruments.
The Bank shall take all the necessary measures for the application of the rules set forth by the ECBwith a view to ensuring efficient and sound cleari ng and payment systems in the sense of Article 22
of the ESCB Statute.
[]'
The proposed amendment is intended to align Article 55 No 5 with the amendment to Section (e) ofArticle 2 (see paragraph 4 above). It specifies the powers of the Bank of Greece concerning meansof payment. The ECBs opinion applies here mutatis mutandis  as well, i.e. the ECB welcomes the
clarification of the powers of the Bank of Greece over means of payment. However, in order toavoid any misunderstanding, the ECB recommends introducing the sentence 'in accordance withthe provisions, if any, applicable each time in the ESCB legal framework' at the end of the aboveamendment. Such addition, similarly to other provisions of the Statute of the Bank of Greece, takesinto account the applicable ESCB rules.
10. Article 55 No 18
It is proposed that this Article read as follows:
'The business of the Bank shall be restricted to the following operations. The Bank, acting inaccordance with the provisions applicable each time in the ESCB legal framework, may:
[]
18. by securing and keeping the required technical equipment and necessary personnel,
undertake the striking of metal coins and medals also on behalf of the Greek government as
5well as  or of third parties. Moreover, the Bank may engage in printing activities of any
nature whatsoever and dispose of the articles produced hereunder by way of derogation
from the provision of Article 56 No 22 hereof; 
[]'
The proposed amendment is intended to clarify that the Bank of Greece on its own behalf may also
carry out the activities provided for therein. In addition, the proposed insertion of the secondsentence enables the Bank of Greece to utilise its plant, equipment and personnel by broadening thescope of its business, both to engage in printing activities of any kind and to sell the goodsproduced in its plant. Moreover, the proposed insertion provides a legal basis for activitiestraditionally undertaken by the Bank of Greece, which have so far been legitimised on an ad hocbasis, by statutory ratification of the agreements concluded from time to time. The abovearrangement is a matter internal to the Bank of Greece and does not give rise to any specificobservations from the ESCBs perspective.
11. Article 55B
It is proposed that this Article read as follows:
'The Bank, through the Monetary Policy Council,  shall establish a framework of administrative
sanctions and specify in detail how they are to be applied to persons who violate the provisionspertaining to the tasks of the Monetary Policy Council under Article 35A.These sanctions shall include in particular the following:
[]
f) a fine in favour of the Greek State, calculated either as a rate of up to 40 per cent on the
amount of the violation, or as a lump sum of up to two hundred thousand euro (200,000) or,
in case of relapse, up to three hundred thousand euro (300,000), provided that the
imposition of this sanction is not in conflict with the rules in force from time to time within
the European System of Central Banks. The above ceilings may be adjusted by an act of the
Monetary Policy Council.
[]'
By adding a 'fine in favour of the Greek State' to  the list of sanctions in Article 55B, the Bank of
Greece is empowered to impose sanctions on entities other than credit institutions, when theybreach provisions falling under the powers of the Monetary Policy Council. The ECB has notedwith satisfaction that such sanctions may not be imposed if they conflict with ESCB rules, notablyconcerning breaches for which the ESCB rules restrictively list the sanctions imposed that excludefines. However, the ECB would like to recommend caution when applying this Article. The
                                                     
2 Article 56 No 2 reads as follows: The Bank is not entitled to: [] 2.: engage in trade, or otherwise have a direct interest
in any commercial, industrial or other enterprise; []
6absence of rules within the ESCB in certain areas may be deliberate and thus preclude a national
authority from assuming responsibility in th is respect. For example, the TARGET legal
documentation does not provide for a system of fines, and thus the Bank of Greece may not createsuch a system as far as TARGET-related matters are concerned. Therefore, the Bank of Greece isencouraged to liaise with the ECB in those cases where doubts might exist as to whether
application of the Article could perhaps conflict with existing or possible future ESCB policies.
12. Article 55D
It is proposed that this Article read as follows:
'Without prejudice to the provisions of Article 5 of the ESCB Statute and of complementary
European Union legislation adopted in application thereof, the Bank of Greece, in addition to itscontrolling authority in the context of prudential supervision, shall have the right to examine andmake copies of all the books and records belonging to any natural person or legal entity engagedin any sort of enterprise, provided that, in the B anks judgement there are indications of a violation
in the conduct of any activity which is related to the tasks of the Bank of Greece, under Article 2
thereof.
[]'
The above provision, according to its current wording, provides for the Bank of Greeces power toexamine the books and records of persons not supervised by it 'provided that, in the Banksjudgement, there are indications of a violation in the conduct of any activity which is related to the
task of the Bank of Greece, under Article 2 here of.' The deletion of the phrase 'under Article 2
hereof', which refers to the Bank of Greeces main activities only, is intended to makeunambiguously clear that the above power to exam ine books and records extends to all activities
related to the tasks of the Bank of Greece and not only to its main activities. The ECB welcomesthis clarification, which does not give rise to any specific observations from the ESCBsperspective.
13. Article 56 No 3
It is proposed that this Article read as follows:
'The Bank is not entitled to:
[]
3. become the possessor of immovable property, except insofar as it is necessary for its own
business, and with the exception provided for in Article 58 as well as with the exception of
acquisitions under a specific provision of law or by universal or quasi-universal succession.
7A justified decision of the General Council may permit the maintenance or acquisition of
immovable property provided that it serves a specific interest of the Bank;'
The proposed amendment is intended to relax the above prohibition, which, however, is maintained
as the main rule and is associated with the prohibition of trade provided for in the immediatelypreceding paragraph
3. Specifically, its intention is to enable the Bank of Greece to maintain its
immovable property (e.g. its branch buildings) in the event that its business shrinks and/or toacquire immovable property within the context of a broader transfer of property, imposed by law orinitiated for reasons of general concern (e.g. social security buildings, where the Bank of Greeceitself provides social security coverage for its staff). The above arrangement is a matter internal tothe Bank of Greece and does not give rise to any specific observations from the ESCBsperspective.
14. Article 56 No 4
It is proposed that this Article read as follows:
'The Bank is not entitled to:
[]
4. purchase its own shares, or  the shares of any other Bank, or corporation, except for the
shares of the Bank for International Settlements;'
The new wording of this provision repeals the prohibition on acquisition by the Bank of Greece ofits own shares, which, at the time of its introduction, referred to a rule applicable to all publiccompanies limited by shares  so as to harmonise its Statute with the current derogations from the
general prohibition, which, however, continues to be the main rule according to Article 16(1) ofLaw 2190/1920
4. As a result of the repeal of that prohibition, in conjunction with the express
provision of Article 72 of the Statute5, the cases of legitimate acquisition referred to in
Article 16(2) and (5) of Law 2190/19206 also apply to the Bank of Greece. Such cases of legitimate
acquisition derive from EC Directive [...]. The above arrangement is a matter internal to the Bankof Greece and does not give rise to any specific observations from the ESCBs perspective.
                                                     
3 See footnote 3 for the text of Article 56 No 2.
4Article 16(1) of Law 2190/1920 reads as follows: A company limited by shares may not acquire its own shares.
5Article 72 of the Statute reads as follows: The provision of the laws on corporations (s ociétés anonymes) and Banks
shall not apply to the Bank of Greece when in conflict with this Statute.
6Article 16(2) of Law 2190/1920 reads as follows: This provision shall not apply in the case of a) acquisitions made inview of amortisation of the capital, b) acquisitions made in view of reduction of capital , c) acquisitions by way of
compulsory attachment in satisfaction of the companys own claims, d) acquisitions made by banking companies by
order of a third party e) acquisitions made gratuitously provided they have been paid off completely, f) acquisitions madefor the purpose of distribution of shares to the company personnel or to the personnel of a company connectedherewith
Article 16(5) of Law 2190/1920 reads as follows: Companies the shares of which are quoted on the Athens Stock
Exchange may, following a decision of the General Meeting of Shareholders taken by virtue of the provisions ofArticles 29 paras 1 and 2 and 31, para 1, acquire their own shares through the Stock Exchange up to 10% of the total oftheir shares 
815. Article 56 No 5
It is proposed that this Article read as follows:
'The Bank is not entitled to:
[]
5. pay interest on deposits or current accounts with the Bank. The Bank may, in derogation to
the general prohibition, pay interest to the Greek State as provided for in Article 457, as well
as on deposits of other Banks in Greece. Furthermore, interest may be paid on time  deposits
kept with the Bank in foreign convertible exchange , of other Banks, or of natural persons or
legal entities established abroad as well as on advances made to the Bank by the saidpersons and in the cases where payment of interest is provided for by the rules in force from
time to time within the European System of Central Banks.
[]
According to the current wording of the above pr ovision, one of the exceptions to the continuing
basic prohibition of payment of interest by the Bank of Greece on deposits or accounts is its right topay interest 'on time deposits kept with the Bank in foreign convertible exchange, of other Banks,or of natural persons or legal entities established abroad, as well as on advances made to the Bankin foreign convertible exchange by the said person'. The repeal of this condition for payment ofinterest on deposits (i.e. to be in foreign convertible exchange) is proposed in response toreasonable requests by legal entities established abroad (e.g. the Commission of the EuropeanCommunities), particularly in relation to deposits in currencies of EU Member States in the nameof legal entities established abroad, on which interest used to accrue, as long as they were depositsin foreign exchange, but this ceased to apply on conversion into euro deposits. The ECB welcomesthis clarification, which does not give rise to any observations from the ESCBs perspective.
16. Article 58
It is proposed that this Article read as follows:
[...]
In the case of failure to repay a debt due to the Bank, any immovable property coming into thepossession of the Bank under this article shall be realised as speedily as possible by public auctionor private sale. No such property may be retained by the Bank for its own purposes, unless
required for the carrying on of the business of the Bank  without prejudice to Article 56 No 3.
[]'
                                                     
7 Article 45 reads as follows: [.] The Bank shall pay interest on such accounts. The interest rate shall be determined in
an agreement to be entered into between the parties concerned and shall in any case reflect the market terms andconditions. 
9The proposed amendment is intended to align Article 58 with the amended provision on acquisition
of immovable property as per Article 56 No 3 (see paragraph 13 above). The above arrangement isa matter internal to the Bank of Greece and does not give rise to any specific observations from theESCBs perspective.
17. Article 68
It is proposed that this Article read as follows:
'In the event of calling in of any series of banknotes denominated in drachmae, the GeneralCouncil shall determine and publicly announce the period within which the said notes should bepresented for exchange. After expiration of such period, the banknotes denominated in drachmaerecalled shall cease to be legal tender except within the Bank of Greece.
Two years  After the expiration of the latest date publicly announced for the calling in of a series of
banknotes denominated in drachmae, the Bank is  entitled to deduct from the amount of note
circulation the amount of the banknotes denominated  in drachmae of the series then outstanding
and unpaid, and the notes shall no longer be considered in circulation. Ten years after theexpiration of the same as above date, these notes shall be considered as having been prescribedand the bearer of same shall have no valid claim whatsoever arising therefrom.'
In so far as this paragraph and the preceding paragraph (i.e. Article 68 in whole) concernwithdrawal of illegal tender, it could be totally repealed. However, this is not, for the time being,considered by the Bank of Greece, as the drachma withdrawal procedure is still in progress andboth the Bank of Greece General Council decisi on on withdrawal and the exchange of drachmae
and Article 5 of Law 2948/2001
8 on the same issue expressly refer to Article 68. Since there can be
no confusion as to the meaning of the first paragraph of Article 68 now that the drachma has beenreplaced by the euro, the ECB does not have any reservations on this point. However, the ECBwould of course recommend revising the first paragraph so as to reflect the actual situation once theabove reasons not to do so have disappeared (it being acknowledged that this may only be in 2012when the exchange period for drachmae against euro banknotes has expired). In addition, the Bankof Greeces right 'to deduct from the amount of  note circulation the amount of the banknotes
denominated in drachma of the series then outstanding and unpaid' so that 'the notes shall no longerbe considered in circulation' (first sentence of the provision), as it is exclusively associated withcurrency in circulation, can no longer be subject to a time limit (since it would now concern atotally withdrawn currency) and can only be exer cised from the moment of withdrawal onwards.
Therefore, the proposed amendment abolishes the tim e limit (of two years), so that this issue will
                                                     
8Article 5 of Law 2948/2001 reads as follows: 1. From 1st March 2002 up to 1st March 2012 drachmae banknotes shall
continue to be accepted for exchange with euro banknotes from the Bank of Greece, pursuant to Article 68 of its Statute.2. From the 1
st March 2002 up to 1st March 2004 drachmae coins shall continue to be accepted for exchange with euro
banknotes from the Bank of Greece and the public financial offices [.]
10not seem to be addressed contra litteram legis . The ECB welcomes this clarification, which does
not give rise to any specific observations from the ESCBs perspective .
18. The ECB confirms that it has no objection to the competent national authorities making this
opinion publicly available at their discretion. This  opinion will be published on the ECBs website
six months after the date of its adoption.
Done at Frankfurt am Main on 28 March 2003.
The President of the ECB
[signed]
Willem F. DUISENBERG