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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