do-me/EUR-LEX huggingface dataset:
Opinion of the European Monetary Institute on draft rules concerning the minimum reserve requirements regime applied by the Banco de Portugal (CON/94/5)
Date: 1994-09-21
Institutions: European Monetary Institute
Subjects: European System of Central Banks, Portugal, competitiveness, financial institution, financial stability, monetary policy

EUROPEAN MONETARY INSTITUTE

OPINION OF THE EUROPEAN MONETARY INSTITUTE ON DRAFT RULES

CONCERNING THE MINIMUM RESERVE REQUIREMENTS REGIME APPLIED

BY THE BANCO DE PORTUGAL (CON/94/5)

1

With a view to Article 109f(6) of the Treaty on European Union, Article 5.3 of the EMI's Statute and

Council Decision 93/71/EC of 22 November 1993, on 27 July 1994 the Banco de Portugal submitted

to the EMI for consultation draft rules on the minimum reserve requirements applied by the Banco de

Portugal. In doing so, the Banco de Portugal acted in its own name, as the adoption of such rules has

been  delegated  to  the  Portuguese  central  bank.  On  the  basis  of  Article  4  of  Council  Decision

93/71/EC, the Banco de Portugal requested the EMI to deliver its opinion at the latest by the end of

September 1994.

2

The main purpose of the change of the regime is to lower reserve requirements in order to converge to

European Union standards and at the same time to contribute to the competitiveness of the Portuguese

financial  system.  As  the  lowering  of  reserve  requirements  would  increase  liquidity,  the  Banco  de

Portugal,  in  order  to  mop  up  excess  liquidity,  envisages  obliging  institutions  subject  to  reserve

requirements  to  hold  certificates  of  deposit  issued  by  the  central  bank.  These  certificates  would  be

tradeable  among  the  institutions  subject  to  reserve  requirements  as  well  as  between  them  and  the

Banco de Portugal.

3

The competence of the EMI to deliver an opinion in this consultation is based on Article 1, second

indent, of Council Decision 93/71/EC (draft legislative provisions on instruments of monetary policy).

The rules which the Banco de Portugal intends to adopt  are  regarded  as  draft  legislation  within  the

meaning of Article 2, paragraph 1, of Council Decision 93/71/EC as the addressees of the rules are in

principle an indefinite number of banks.

4

With regard to the substance of this consultation, all features of the envisaged changes to the system

of  reserve  requirements  in  Portugal  appear  to  be  in  compliance  with  the  Treaty.  The  EMI  is  of  the

opinion that adjusting the system of compulsory reserves in Portugal constitutes a useful step to bring

minimum reserve standards in Portugal into line with those currently existing in many other European

countries.  At  the  same  time,  the  EMI  regards  it  as  premature  to  formulate  a  view  on  whether  the

envisaged  rules  will  be  adequately  compatible  with  the  future  system  of  the  ESCB,  as  discussions

concerning the desirable features of this system have not yet been completed.

21 September 1994