RBF Transfers $16.9m Profits To Government Coffers

Financial year figures for seven months only in order to align with Government’s new financial year   The Reserve Bank of Fiji yesterday transferred $16.9 million into Government coffers from
04 Oct 2016 11:00
RBF Transfers $16.9m Profits To Government Coffers
Barry Whiteside.

Financial year figures for seven months only in order to align with Government’s new financial year


The Reserve Bank of Fiji yesterday transferred $16.9 million into Government coffers from its 2016 profits for seven months ended July 31.

This comprised its entire profit of $13.9 million and $3 million, which represents one fifth of the balance of the revaluation reserve account.

This compares with a transfer to Government of $32.2 million for the 12 months ended December 31, 2015.

The profits were for seven months because the RBF has to align its financial year to coincide with the financial year of Government.

Since Government financial year now starts from August, the Board of RBF signed off on annual audited financial statements for the seven months ended July 31 on September 29.

The Governor and Chairman of the Board, Barry Whiteside, said: “This is a good result given the challenging domestic and international economic environment.

“This is the second time RBF has met the statutory obligation of providing the audited financial statements and the Operations Report to the Minister one month earlier than required.”

Mr Whiteside thanked his team for this remarkable achievement.


Financial details

Foreign reserves are the principal source of RBF’s income.

Mr Whiteside noted foreign reserves continued to be low in most of our trading partner countries and constrained income from investments of foreign reserves.

The RBF’s expenditure for the January-July period was within budget at $15.6 million.

Despite the various setbacks earlier in the year with Tropical Cyclone Winston and the floods associated with TC Zena, the Bank achieved its key objectives of an adequate level of foreign reserves and low inflation.

The inflation rate at the end of July was 5.5 per cent and in part was driven by supply conditions of market items due to the impact of Tropical Cyclone Winston.

In August, inflation rose to 5.9 percent, the fourth consecutive month above the 5.0 percent mark.

This was underpinned by higher prices for food & non-alcoholic beverages; alcoholic beverages – particularly yaqona, tobacco & narcotics; education; health; restaurants & hotels; and clothing & footwear.

Up-side risks revolve largely around supply side inflationary pressures.

Persistent high yaqona prices indicate the likelihood of continued inflationary pressure towards the end of 2016.

The outlook for imported inflation remains subdued with low forecasts of trading partner inflation; no sharp changes in crude oil futures and softer global growth prospects.

Given the recent inflation outcome, there is upward bias to the year end inflation forecast of 3.5 per cent. The foreign reserves objective was attained with holdings at the end of July of $1.9 billion, sufficient to cover 5.5 months of imports.



Mr Whiteside added the Fijian economy is projected to grow for the seventh consecutive year despite the natural disasters.

“The current forecast for 2016 is 2.4 per cent,” he said.

“Work is continuing on evaluating the growth figure taking into account the impact of rehabilitation work after the natural disasters and the impact of announcements in the National Budget.

“Financial conditions have been largely favourable given ample liquidity in the banking system and low interest rates which have supported economic growth.

“The financial system remained sound, backed by adequate earnings, capital, liquidity positions and asset quality for commercial banks, insurance companies and credit institutions.

“However, general insurance companies were affected due to the catastrophic events earlier in the year.”



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