Regulatory Alerts2008-11-24
Chapter VII Relations of the Central Bank with Other Public Institutions
The Central Bank of Bosnia and Herzegovina acts as the banker and fiscal agent for the state and designated public agencies, strictly prohibited from providing financial assistance or credit to the government. It is mandated to consult with the Ministry of Finance on budget preparation and public sector borrowing plans, while maintaining independent advisory roles and reporting obligations to the Council of Ministers. The Bank also manages deposits for public institutions and executes fiscal agency functions through trust funds for debt securities and related transactions.
CHAPTER VII Relations of the Central Bank with Other Public Institutions
Article 52. Banker, Advisor, and Fiscal Agent
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The Central Bank shall act as the banker and fiscal agent of Bosnia and Herzegovina and public agencies designated by the Presidency of Bosnia and Herzegovina, provided that no transaction carried out by the Central Bank may serve as financial assistance, including credit, for or on behalf of Bosnia and Herzegovina.
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The Central Bank and the Ministry responsible for the budget of Bosnia and Herzegovina may consult with each other, and it is the duty of the Central Bank to provide advice to the Ministry responsible for the Budget of Bosnia and Herzegovina on all significant matters relating to its tasks or tasks otherwise within its competence.
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Each year, the Ministry responsible for the Budget of Bosnia and Herzegovina may consult the Central Bank on the preparation of the budget, and if consulted, the Central Bank submits a written report to the Council of Ministers of Bosnia and Herzegovina on economic and financial matters.
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The Central Bank shall not act as the banking or fiscal agent for either the Federation of Bosnia and Herzegovina or the Republika Srpska, unless there is a joint decision of both Entities.
Article 53. Consultations and Reporting on Public Sector Borrowing
Each year, the competent authority of Bosnia and Herzegovina shall consult with the Central Bank on the plan for external borrowing of the public sector during the next financial year, including the amounts to be contracted and paid under such borrowing, as well as the expected terms and conditions for such borrowing. A report on all external borrowing transactions of Bosnia and Herzegovina and its public institutions shall be submitted to the Central Bank, containing such details as the Central Bank determines by regulation with the approval of the Presidency of Bosnia and Herzegovina.
Article 54. Depository and Paying Agent
The Central Bank may accept deposits in its headquarters and main branches in convertible marks and foreign currency from institutions of Bosnia and Herzegovina and public agencies designated by the competent Ministry of Bosnia and Herzegovina. As a depository, the Central Bank receives deposits and makes payments up to the limits of deposited funds according to payment orders for those accounts. The Central Bank pays interest on such deposits at a market-oriented rate after deducting its administrative costs.
Article 55. Function of Fiscal Agent
The Central Bank may act as the fiscal agent for Bosnia and Herzegovina and its public agencies in the following cases only through a trust fund and under conditions agreed upon with the competent authorities of Bosnia and Herzegovina:
a. the sale of debt securities issued, as registrar or intermediary in transfer; b. the payment of principal, interest, and other costs on those securities; c. payment transactions relating to their accounts at the Central Bank; and d. other matters consistent with the basic objectives and tasks of the Central Bank.
Article 56. Notifications to be Provided to the Central Bank
Bosnia and Herzegovina shall provide the Central Bank with all economic and financial notifications and documents requested by the Central Bank for the purpose of carrying out its operations.