Reserve requirements are leu- and foreign currency-denominated holdings of credit institutions on accounts opened with the NBR.

The main functions of leu-denominated reserve requirements are the monetary control (in close correlation with liquidity management by the NBR) and the stabilisation of interbank money market rates. The major role of foreign currency-denominated reserve requirements is to contain the expansion of foreign exchange loans.

The main characteristics of reserve requirements are:

1. the reserve base is established as the average daily balances (during the observance period) of both leu- and foreign currency-denominated liabilities from credit institutions' balance sheets (except interbank liabilities, obligations to the NBR and own capital);
2. the observance period and the maintenance period are one-month long and successive (the observance period lasts from the 24 of the previous month to the 23 of the current month);
3. reserve requirements ratios can be different in terms of currency and residual maturities of the items included in the reserve base (shorter or longer than 2 years);
4. reserve requirements are the average daily balances held with the NBR during the maintenance period;
5. reserve deficit is subject to a penalty rate, while recurrent deficits are sanctioned by warning, fines or limitation of operations conducted by the credit institutions.

Reserve ratios

Interest rate on required reserves

Penalty rates for reserve deficits