OTHER NATIONS’ CENTRAL BANKING

Reserve Bank of New Zealand

The bank manages monetary policy to maintain price stability, promotes the maintenance of a sound and efficient financial system and supplies New Zealand banknotes and coins.

What is the Reserve Bank of New Zealand?

The Reserve Bank of New Zealand is New Zealand’s central bank. It was established in 1934, and although not a government department, has been wholly owned by the government of New Zealand since 1936. Like most central banks, the Reserve Bank is primarily a policy organization, and has three main functions: operating monetary policy to maintain price stability;promoting the maintenance of a sound and efficient financial system; andmeeting the currency needs of the public.

The Reserve Bank’s role in the New Zealand financial system has developed over the years, and includes a requirement that banks must be registered with the Reserve Bank. Registered banks must meet certain criteria with regard to their financial position, and only organisations formally registered with the Reserve Bank are entitled to use the word ‘bank’ in their names. In late 2007 the decision was taken by government to extend the Bank’s regulatory oversight to finance and insurance companies, building societies and credit unions.The Reserve Bank also operates New Zealand’s wholesale payment and settlement systems, which the registered banks use to complete their transactions with each other, and which handle approximately $40 billion in transactions per day. These systems are not only vital to the New Zealand economy, but also allow the Bank to implement its monetary policy settings.

Central Bank of the United Kingdom

The bank of england is the central bank of the united kingdom. Sometimes known as the 'old lady' of threadneedle street, the bank was founded in 1694, nationalised on 1 march 1946, and gained independence in 1997. Standing at the centre of the uk's financial system, the bank is committed to promoting and maintaining monetary and financial stability as its contribution to a healthy economy.The bank's roles and functions have evolved and changed over its three-hundred year history. Since its foundation, it has been the government's banker and, since the late 18th century, it has been banker to the banking system more generally - the bankers' bank. As well as providing banking services to its customers, the bank of england manages the uk's foreign exchange and gold reserves. The bank has two core purposes - monetary stability and financial stability

Interest rate decisions are taken by the Bank's Monetary Policy Committee. The MPC has to judge what interest rate is necessary to meet a target for overall inflation in the economyThe Bank offers technical assistance and advice to other central banks through its Centre for Central Banking Studies, and has a museum at its premises in Threadneedle Street in the City of London, open to members of the public free of charge.