Reserve Management

Framework
Presented by:
Abubakar Riaz
Hailey College of
Commerce,
University of the Punjab

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I will be explaining you the following

Australia

Objectives of
Benchmark
reserve
Portfolio
management

Transparency Organizational
practices Structure

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O
bj
O
ec
bj
ec
ti
ve
ti
s
ve
s

Australia Reserves are

held for intervention
purpose.

Managed in such a
manner that gives
priority to low levels
of credit risk ,

Limited exposure to
market risk

While maintaining a
high degree of
liquidity

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 Governor

Assistant
Assistant Governor
Governor
Dealing Financial
Financial Markets Group
Markets Assistant
Assistant Governor
Governor
Dealing Support
Support Group
(Middle (FMG)
(FMG)
(Middle Office)
Office)
it
it manages the
manages the risk
risk and
and
return
return

Payment
Payment settlements
settlements
(back
(back Office)
Office)
Provides
Provides standard
standard
settlements
settlements and
and
communicational
communicational
Head
Head of
of International
International Department
Department Services
Services and
and responsible
Organiz for
responsible
Responsible
Responsible for operation in
for operation in markets
markets for
for for final
final approval
approval of
of
ational foreign
foreign exchange, gold and offshore assets.
exchange, gold and offshore assets. transactions
transactions
Structur
e

Front
Front Office
Office
It
It Mangaes the currency
Mangaes the currency
and
and asset
asset allocation
allocation Analysis
Analysis
position
position of
of portfolio
portfolio and
and Provides
Provides indepth anaylsis
indepth anaylsis of
of
policy international
international financial and
financial
policy issues like
issues like macroeconomics
and
assessing
assessing instruments
instruments macroeconomics develments.
develments.
and
and structure
structure ofof
Benchmark.
Benchmark.

New
New york
york London
London
Dealing 4 of 9
Dealing Center
Center Dealing
Dealing Center
Center
TRANSPARENCY AND ACCOUNTABILITY

The RBA publishes statistical

information on its reserves and foreign
The RBA
currency publishesin
transactions statistical
its monthly
information
Bulletin. Also,onsince
its reserves
1992, the and foreign
Bank has
currency transactions in its
provided an overview of reservesmonthly
Bulletin. Also, since
management 1992, the
operations andBank
returnhas
provided an overview of reserves
relative to benchmark in its Annual
management
Report. operations
It is SDDS and return
subscriber; Special
relative to benchmark in its Annual
data dissemination standards, as an IMF
Report. It is country
member SDDS subscriber;
it observesSpecial
the
data dissemination standards,
standards and reserves data templateas an IMF
member country it observes
approved by IMF’s executive board. the
standards and reserves data template
approved by IMF’s executive board.

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 Official Reserve Assets
  In Million of US Dollars
    May 2010
  Official reserve 36,341.71
(1) Foreign currency reserves (in convertible foreign currencies) 27,237.72
(a) Securities of which: issuer headquartered in reporting 21,349.6  
country but located abroad 0
(b) total currency and deposits with: 5,888.12
(i) other national central banks, BIS and IMF 580.18  
of which: located abroad

(ii) banks headquartered outside the 5,307.93

reporting country of which: located in the
reporting country
   
(2) IMF reserve position 1,031.15
(3) SDRs 4,585.92
(4) gold (including gold deposits and, if appropriate, gold swapped) 3,112.53
  -volume in millions of fine troy ounces 2.57  
(5) other reserve assets (specify) 374.39
  -financial derivatives -0.14  
  -other 374.54  

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CAPACITY TO ASSESS AND MANAGE RISK
United States Europe Japan

Currency allocation (%) 45 45 10

Asset allocation (%) 45 45 10

Duration (Months) 30 30 30

United States   Europe   Japan

Asset Class % of Total Asset Class % of Total Asset Class % of Total

Deposits 22 Deposits 30 Deposits 22

Treasury bills 21 Treasury bills 15 Treasury bills 33

Treasury Notes 57   Bonds 55   Bonds 45

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Horizon Analysis

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Thank You
Thank You

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