REPUBLIC OF LITHUANIA LAW ON THE CREDIBILITY OF THE LITAS Article 1. Guaranteeing the Credibility of the Litas The Litas

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 "Valstybës þinios" (Government Records) at least once a month. Article
6. Entry into Force This Law shall become effective as of 1 April
7. Article
8. 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 ____________