BANK OF MOUNT VEMA

THE CENTRAL BANK OF THE KINGDOM OF MOUNT VEMA
The Bank of Mount Vema is the Central Bank of the Kingdom of Mount Vema, an agency of the Royal Mount Vema Reserve Bank, and it is the Monetary Authority of the Kingdom of Mount Vema - The Vema Seamount Territory, responsible for issuing bank notes and general management of the currency.
Central Bank Interest Rate: 3.45%
The Currency of the Vema Seamount Territory
Bank of Mount Vema Liquidity Swap Facilities.pdf
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Licensing / Approval for the Conduct of Mount Vema Banking Business.pdf
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​The Bank of Mount Vema manages the currency of the territory, money supply, interest rates, and oversees the commercial banking system.  The central bank also acts as a "lender of last resort" to the banking sector during times of financial crisis. Therefore, it is institutionally designed to be independent from political interference.
Functions of the Bank of Mount Vema include:
  • implementing monetary policies
  • setting the official interest rate – to manage both inflation and the exchange rate of the territory – and ensuring that this rate takes effect via a variety of policy mechanisms
  • controlling the nation's entire money supply
  • the Government's banker and the bankers' bank (""lender of last resort")
  • managing the country's foreign exchange and the Government's stock register
  • regulating and supervising the banking industry
Currency Issuance
Similar to commercial banks, the Bank of Mount Vema hold assets (government bonds, foreign exchange, gold, and other financial assets) and incur liabilities (currency outstanding). The Bank of Mount Vema creates money by issuing interest-free currency notes and selling them to the public (government) in exchange for interest-bearing assets such as government bonds. When the Bank of Mount Vema wishes to purchase more bonds than His Mount Vema Majesty’s Government make available, it may purchase private bonds or assets denominated in foreign currencies.
Interest Income
Although, an agency of the Reserve Bank, the Bank of Mount Vema, does not remits its interest income to the Reserve Bank, it remits to the Treasury of His Mount Vema Majesty’s Government. This income, derived from the power to issue currency, is internationally referred to as seigniorage, and usually belongs to the national government. The state-sanctioned power to create currency is internationally called the Right of Issuance.
Price Stability
The Bank of Mount Vema also works to manage inflation. Additional information will be made available after 2020.