BELARUS NEWS AND ANALYSIS

DATE:

06/12/2006

Natl. Bank of Belarus ups gold reserves to 25.5 tonnes

MINSK. Dec 6 (Interfax) - The National bank of Belarus (NBB) has increased its gold reserves to 25.5 tonnes, from 25.02 tonnes on January 1, 2006, Taras Nadolny, the bank's chief precious metals and gemstones officer, said at an international banking conference.

The NBB began to put together its gold reserve in 2000. Nadolny said the bank is currently following "an aggressive policy for deals with precious metals on foreign markets and is carrying out all operations linked with this area." Profit from operations with precious metals occupies a considerable place in the National Bank's overall profit, which is also due to the relatively low purchase price for gold acquired earlier.

Gold and foreign currency reserves, which the bank began to put together in 1998, amount to about $1.5 billion, which is the equivalent to critical imports for 27 days, Nadolny said. In international practice, gold and foreign currency reserves are considered sufficient if they correspond to three months of critical imports. "The volume of gold and foreign currency reserves, therefore, needs to be increased," he said.

Nadolny spoke about the intensive development of the domestic gold bar market, which has grown 300% year-on-year in January-November 2006. The National Bank of Belarus estimates that the sale of gold in bars will amount to at least 1 tonne in 2006.

The domestic gold market in Belarus is receiving additional stimulus because companies and private clients can open a metal account, enabling precious metal buy-sale transactions without using them in their physical weight. Nadolny said he was sure about the integration of the domestic precious metals market with the international market. "The National Bank has all the prerequisites for this."

The National Bank of Belarus plans to raise its gold and foreign currency reserves to $3 billion by the end of 2010 and its gold reserve to 32 tonnes.

Source:

http://www.interfax.com/3/220097/news.aspx

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