REPUBLIC OF LITHUANIA
LAW
ON
THE CREDIBILITY OF THE LITAS
Article 1. Guaranteeing the Credibility of the Litas
The Litas put into circulation by the Bank of Lithuania is
fully covered by gold and foreign exchange reserves of the Bank
of Lithuania.
Article 2. The Amount of the Litas in Circulation
The Bank of Lithuania shall guarantee that the total amount
of the Litas put into circulation does not exceed the gold
reserve (at market prices) and foreign exchange reserves
(according to the official exchange rate of the Litas) of the
Bank of Lithuania at any time.
The total amount of the Litas put into circulation shall
consist of:
1) banknotes and coins in circulation;
2) the sum of the balances of nominal accounts of other
banks and holders of litas accounts kept with the Bank of
Lithuania; and
3) the sum of the securities and other promissory notes of
the Bank of Lithuania in litas.
Foreign exchange reserve shall consist of :
1) banknotes and coins of convertible currency held by the
Bank of Lithuania;
2) the amount of convertible currency held by the Bank of
Lithuania in the correspondent accounts in foreign banks and the
International Monetary Fund; and
3) promissory notes, certificates of deposits, bonds, other
debt securities payable in convertible currency, which are held
by the Bank of Lithuania.
The Bank of Lithuania may change the total amount of the
Litas in circulation only by changing gold and foreign exchange
reserves respectively.
Article 3. The Official Exchange Rate of the Litas
The official exchange rate of the Litas shall be established
against the currency chosen as the anchor currency.
The official exchange rate of the Litas and the anchor
currency shall be established or changed by the Government of the
Republic of Lithuania upon coordination with the Bank of
Lithuania.
Article 4. The Exchange of the Litas
The Bank of Lithuania shall guarantee to the extent of its
gold holdings and foreign exchange reserves free exchange of the
Litas specified in Paragraph 2 of Article 2 into the anchor
currency according to the official exchange rate of the Litas, as
well as free exchange of the anchor currency into the Litas
within the territory of the Republic of Lithuania.
Other foreign currencies shall be exchanged into litas and
litas shall be exchanged into other foreign currencies according
to the market exchange rate.
Maximum amounts of charges for exchange operations shall be
established by the Bank of Lithuania for all banks.
Commercial banks shall be liable under law for the violation
of the procedure of exchange operations.
Article 5. Information on the Litas
The Bank of Lithuania shall publish information on the total
amount of litas in circulation, gold holdings and foreign
exchange reserves in the "Valstybės žinios" (Government Records)
at least once a month.
Article 6. Entry into Force
This Law shall become effective as of 1 April 1994.
Article 7. Validity of the Law of the Bank of Lithuania and
the Statute of the Bank of Lithuania
The Law of the Bank of Lithuania and the Statute of the Bank
of Lithuania shall be valid until the adoption of a new Law of
the Bank of Lithuania and to the extent it complies with the
provisions of this Law.
I promulgate this Law adopted by the Seimas of the Republic
of Lithuania.
ALGIRDAS BRAZAUSKAS
President
of the Republic
Vilnius
17 March, 1994
No.I-407
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