EN 
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 1 August 2007 
at the request of Banca Na ţională a României 
on a draft circular on the minimum reserves regime 
(CON/2007/22) 
 
Introduction and legal basis  
On 5 July 2007 the European Central Ba nk (ECB) received a request from Banca Na ţională a României 
for an opinion on a draft circular amending an d the supplementing Regulation No 6/2002 on the 
minimum reserves regime (hereinafter ‘draft circular’). 
The ECB’s competence to deliver an  opinion is based on Article 105(4) of the Treaty establishing the 
European Community and Article 2(2) of C ouncil Decision 98/415/EC of 29 June 1998 on the 
consultation of the European Central Bank by natio nal authorities regarding draft legislative provisions1, 
as the draft circular relates to minimum reserves requi rements, and the authorities of Member States other 
than participating Member States are obliged to cons ult the ECB on any draft legislative provisions on the 
instruments of monetary policy. In accordance with the first sentence of Article 17.5 of the Rules of 
Procedure of the European Central Bank, th e Governing Council has adopted this opinion. 
 1.  Purpose of the draft circular 
1.1 The main purpose of the draft circular is to align the minimum reserves regime in Romania with the 
corresponding standards of the Eurosystem concerni ng the minimum reserve base. To this end, the 
draft circular amends the definition of the liability  elements included in the minimum reserve base. 
In particular, it excludes the amounts in trans it from the minimum reserves base. Moreover, the 
amounts in transit are also excluded from the calcul ation of the average rate of the sight deposit 
interest, reported by the credit institutions for the establishment of the interest rate paid for the 
minimum reserves. 
1.2 In addition, the draft circular introduces changes regarding building societies. It introduces a 0% 
minimum reserves ratio for such credit institutions
2. 
                                                 
1  OJ L 189, 3.7.1998, p. 42.  
2  Article 288 of Government Emergency Ordinance No 99 of 6 December 2006 on credit institutions and capital adequacy 
published in Monitorul Oficial al României, Part I, No 1027 of 27 December 2006 defines building societies as follows: 
‘Romanian legal persons, as cr edit institutions specialised in  long-term financing for housing, which have as their 
primary activity collective savi ngs and lending for housing.’ 
 
2 2. General observations  
2.1 The ECB notes that, although non-participating Me mber States retain their powers in the field of 
monetary policy, it is nevertheless beneficial to  gradually achieve consis tency with Eurosystem 
standards so that credit institutions operating in  their territory can become acquainted with the 
minimum reserve requirements that will apply once the respective Member States have joined the 
euro area. The legal framework underlying the Eurosystem’s minimum reserve system is laid down in: (i) Article 19 of the Statute of the European System of Central Banks and the European Central 
Bank; and (ii) Council Regulation (EC) No 2531/98 of 23 November 1998 concerning the 
application of minimum reserves by the European Central Bank
3; and (iii) Regulation ECB/2003/9 
of 12 September 2003 on the app lication of minimum reserves4; and (iv) relating to the definition 
and calculation of the reserve base, Regulation ECB/2001/13 of 22 November 2001 concerning the consolidated balance sheet of the monetary financial institutions sector
5. The purpose of these legal 
acts, which are directly applicable to and binding on  euro area credit instituti ons, is to ensure that 
the terms and conditions for the Eurosystem’s mi nimum reserve system are uniform throughout the 
euro area.  
2.2 In the course of preparing for the intro duction of the euro in Romania, Banca Na ţională a României 
will need to examine whether the Eurosystem’s  requirements can be fulfilled effectively and 
whether the necessary measures have been adopted in  Romania to ensure that the authorities have 
the requisite powers, under Romanian law, to assi st and cooperate with the ECB to collect and 
verify the information necessary for the Eu rosystem’s minimum reserve system.  
 3. Concept of minimum reserves  3.1 The ECB welcomes the provisions of the draft circular which narrow the minimum reserve base as 
it contributes to aligning Romanian minimum re serves regime with that of the Eurosystem. 
Article 3 of the Regulation ECB/2003/9 does not include amounts in transit in the reserve base when determining the liabilities compri sing an institution's reserve base. 
3.2  However, the ECB observes that the genera l Romanian framework for the minimum reserves 
requirements still significantly differs from that of  the Eurosystem (e.g. the calculation of the 
reserve base in correlation with the residual matu rity; indirect holdings for minimum reserves not 
generally admitted; specific definition of credit institutions for the purpose of minimum reserves; 
differentiation between ratios applied to holdings in  national and foreign currencies; definitions of 
reference and maintenance periods accordi ng to previous Eurosystem standards)
6. Differences from 
the legal framework under which the Eurosystem ope rates will have to be eliminated on adoption 
of the euro by Romania. 
                                                 
3  OJ L 318, 27.11.1998, p. 1. 
4  OJ L 250, 2.10.2003, p. 10.  
5  OJ L 333, 17.12.2001, p. 1. Regulatio n as last amended by Regulation E CB/2006/20 (OJ L 2, 5.1.2007, p. 3). 
6  Please note that some aspects of the Euro system framework were changed in March 2004. 
 
3 4.  The 0% minimum reserve ratio for building societies 
4.1 The draft circular introduces a 0% minimum rese rve ratio for building societies. This amendment 
would further widen the divergence between the Ro manian and the Eurosystem’s minimum reserve 
frameworks, at least with respect to their holdings with a maturity of less than two years. Indeed, 
according to Article 2 of Regulation ECB/2003/9, all credit institutions in the euro area are subject 
to a minimum reserve requirement and the Roma nian regime also explicitly defines building 
societies as credit institutions for statisti cal reporting and minimum reserve obligations7. For the 
Eurosystem, Article 2(2) of the Regulation only admits exceptions to the minimum reserve system 
on a non-discriminatory basis for: ‘(a) institutions subject to reorganisation measures; (b) institutions for which the purpose of the ECB’ s minimum reserve system would not be met by 
imposing reserve requirements upon them. In reaching a decision on any such exemption, the ECB shall take into account one or more of the followi ng criteria: (i) the institution is pursuing special-
purpose functions; (ii) the institution is not exer cising active banking functions in competition with 
other credit institutions; (iii) the institution has a ll its deposits earmarked for purposes relating to 
regional and/or international de velopment assistance’. This mean s that under the Eurosystem’s 
regime there can only be exemptions by decisi on on a case-by-case basis for individual credit 
institutions based on a thorough an alysis of their specific situ ation. The foreseen automatic 
application of a 0% minimum reserve ratio for all building societies in Romania leads to a de facto  
exemption of this category of credit institutions from minimum reserve requirements, which would 
not meet the abovementioned Eurosystem’s exemp tion criteria. As such treatment also differs 
considerably from the Eurosystem's regime, it w ould have to be re-adj usted upon the introduction 
of the euro at the latest
8. 
 This opinion will be published on the ECB’s website.    Done at Frankfurt am Main, 1 August 2007. 
 
[signed] 
 
The President of the ECB 
Jean-Claude TRICHET 
                                                 
7  See Section 1 Article 1 of Regula tion No 6 of 24 July 2002 of Banca Na ţională a României on the minimum reserves 
regime. 
8  See ECB Opinion CON/2006/11 of 23 February 2006 at the re quest of Latvijas Banka on draft amendments to the 
Regulation on calculating and fulfilli ng the minimum reserve re quirements for banks and ECB Opinion CON/2006/59 of 
14 December 2006 at the request of Eesti Pank on a draft decree establishing a procedure to calculate and comply with 
reserve requirements.