before we try to stomach the bad news. our net international reserves have increased by a full third over the last three years, rising from rs 75 billion in january 2007 and topping rs 100 billion for the first time in november 2009. rest assured that we took steps to reduce our exposure to the dollar, the euro and the pound sterling, which together accounted for over 97 % of our portfolio in 2007. now, this has fallen to a more prudent 70 %, with our dollar and euro exposures having been reduced to 35 % and 25 %, respectively, from 40 and 41 % previously. our sdr allocation and gold holdings make up nearly 14 % of the portfolio, the balance being commodity currencies like the canadian, australian and new zealand dollars and the japanese yen. the nominal value of that gold we controversially purchased from the imf in november 2009, has risen by some rs 570 million, perhaps the best investment the bank has ever made in its entire history ; no wonder there is international talk about moving back to gold as a reference value, if no longer as actual backing, for paper currencies. the platinum coin we launched last year has increased 16 % in terms of platinum value. the gold coin we launched here in 2007 did even better, its value increasing by 42 %. that “ barbarous relic of a bygone age ”, as keynes dubbed gold, has not lost its shine over the centuries and may still be pressed into monetary service! so in this initiative we are ahead of the game, brickbats notwithstanding. our much - maligned exchange rate policy is another success story, to be celebrated, not decried. the meri exchange rate index has been fairly stable, indicating that our policy has minimized volatility and maintained the stability of the exchange rate of the rupee. had the central bank reacted, as many pressed us to do, and followed the euro in its wild gyrations, the economy would have suffered untold damage, with the poorest and most vulnerable strata of our countrymen taking the worst hits. in the course of the year, the bank ventured boldly in two complementary directions. we spent more than rs 11 billion to purchase the equivalent of us $ 375 million in foreign currency, partly in an attempt to contain rupee appreciation. we sold less than half of this, only us $ 156 million, to the state trading corporation at favourable rates in a parallel attempt to finance food and fuel imports and thus

clearing house – was automated, with the standardization of cheques using magnetic ink character recognition ( micr ) technology and, in turn, plach piggy - backed on the macss communication network. well before the global financial crisis had begun to unfold, i had zeroed in on the payment systems as a key contributor to financial stability and economic growth. i therefore decided – against quite some opposition – to create a division within the bank, dedicated to payment system issues, as is the practice in most central banks. the establishment of the mcib – mauritius credit information bureau – under the aegis of the bank of mauritius, was a key element of our fmi. mcib is a public registry of borrower information and provides factual information on the creditworthiness of borrowers. it bis central bankers ’ speeches improved the provision of credit information. it was also instrumental in lowering the ratio of non - performing loans in banks. in other words, it improved the quality of banks ’ loan portfolio. while we have been busy warding off pressing unsolicited offers to acquire it from us, we have also been constantly expanding the coverage of mcib. in 2009, we replaced the macss software with a new application based on international best practice. it is built on a more resilient architecture and supports multi - currency transactions including payment of tax bills in foreign currency. our rtgs is certified “ swift gold label ” and we are the only country in the region to have a multi - currency rtgs. there was still a missing component in our payments landscape – we did not have a proper automated clearing system for low - value payments. these make up the bulk of the payment transactions in our economy. last december, for example, we cleared a record number of cheques : 562, 000 of them in an amount of rs29. 4 billion – or a daily average of 26, 800 for a daily average amount of rs1. 4 billion. we have invested in a bulk clearing system as the first phase in the implementation of a cheque truncation system. at the time that the cheque truncation project was envisaged in mauritius, we wanted to be the pioneers in the region with this system which would do away with the need for physical processing of the large number of cheques which i just mentioned. unfortunately we got entangled in boardroom squabbles and procurement delays. we have been overtaken by other central banks which probably had more