Norges Bank

Circular 6/2016

Quotas in the system for the management of bank reserves


Under the current system for managing banks' reserves, interest is paid at the key policy rate on a certain portion of the reserves – a quota. Deposits in excess of the quota are remunerated at a lower rate – the reserve rate. Norges Bank will normally assess the total quota and its distribution among banks twice a year.

The following applies as from 3 October 2016:

  • Norges Bank will seek to maintain reserves in the banking system at an average NOK 35 billion with a symmetrical interval of ±5 billion around this level.
  • The sum of banks' quotas, the total quota, is set at NOK 45 billion.

Banks are divided into three groups where all banks in the same group are assigned the same quota, with the exception of settlement banks which are assigned higher quotas. The banks are divided into groups as follows (Table 1):

Table 1. Division of banks into groups (as of June 2016)

Group 1: Group 2: Group 3: All B-banks in NBO* (107 banks)
DNB Bank ASA** Sparebank 1 SR Bank  
Nordea Bank Norge ASA Sparebanken Vest  
Danske Bank NUF** Sparebank 1 SMN**  
Handelsbanken NUF Sparebank 1 Nord-Norge  

Sparebanken Hedmark

Swedbank NUF

Sparebanken Møre

  Storebrand Bank ASA  
  Sparebanken Sør  
  BNP Paribas Fortis SA-NV Norway Branch  
  BN Bank ASA  
  Skandiabanken ASA  
  Bank 1 Oslo Akershus  
  Sandnes Sparebank  
  Sparebanken Øst  
  Citibank NUF  
  Sparebanken Sogn og Fjordane  

*Norges Bank's settlement system, **Settlement bank

The quotas that apply as from 3 October 2016 are set on the basis of banks' total assets as at 30 June 2016. The quotas are distributed as follows (Table 2):

Table 2. Banks' quotas to be applied as from 3 October 2016. In thousands of NOK

  Sum TA Share TA Sum quota per
Number banks Quota per
Group 1 3 253 703 401 66,50% 29 940 827 6 5 000 000
Group 2 942 614 037 19,30% 8 674 006 16 540 000
Group 3 693 883 185 14,20% 6 385 166 107 60 000
Sum 4 890 200 623 100% 45 000 000 129  

TA: Total assets

The settlement banks DNB, SpareBank 1 SMN and Danske Bank are assigned quotas as follows (Table 3):

Table 3. Quotas for settlement banks, DNB, SpareBank 1 SMN and Danske Bank*. In thousands of NOK

  Initial quota Supplement to quota  Sum quota
DNB Bank ASA 5 000 000 1 200 000 6 200 000
SpareBank 1 SMN 540 000 560 000 1 100 000
Danske Bank 5 000 000 - 5 000 000

*Settlement banks are assigned a supplementary quota determined by the size of the settlement bank in relation to the size of the B-banks or equivalent banks for which it executes settlements (as measured by total assets). If the estimated quota for the settlement bank is initially NOK K billion, its total assets NOK X billion and the sum of total assets of the B-banks is NOK Y billion, the settlement bank will be assigned a supplementary quota equal to K x (Y/X), but with an upper limit equal to the sum of the quotas for the B-banks for which it executes settlements. The settlement bank's total quota will normally be equal to K+K x (Y/X).

For a further description of the system for the management of bank reserves, see Management of bank reserves: The system in Norway.

For a further discussion of the background for the new system, see Background for the system for the management of bank reserves in Norway.

Published 1 September 2016 10:00