1. FISIM allocation to user sectors by currencies János Polonkai, Hungarian CSO 04.10.2010

2. FISIM allocation to user sectors Legal basis: Legal basis: 448/98 Council Regulation and 1889/02 Commission Regulation 448/98 Council Regulation and 1889/02 Commission Regulation OECD recommendation on national account experts meeting to develop FISIM allocation split by different currencies OECD recommendation on national account experts meeting to develop FISIM allocation split by different currencies

3. History of FISIM allocation From 1995 to 2004 : by single currency (HUF) From 1995 to 2004 : by single currency (HUF) From 2005: by local currency (HUF) and all other currencies (DEV). From 2005: by local currency (HUF) and all other currencies (DEV). FISIM time series at current and constant prices were revised back-casted 1995 by different currencies. FISIM time series at current and constant prices were revised back-casted 1995 by different currencies.

4. Why did we change our FISIM allocation? We assumed, that current price and constant price FISIM figures are more suitable in national accounts, than FISIM figures calculated by single reference rates. We assumed, that current price and constant price FISIM figures are more suitable in national accounts, than FISIM figures calculated by single reference rates.

5. Why did we change our FISIM allocation? - continued - OECD recommendation to determine several external reference rates according to currencies in order to make FISIM allocation more refined. OECD recommendation to determine several external reference rates according to currencies in order to make FISIM allocation more refined.

6. FISIM allocation by different currencies A trial calculation was carried out for 2000-2005 in 2006. A trial calculation was carried out for 2000-2005 in 2006. We defined two currency types: We defined two currency types: HUF ( local currency) and HUF ( local currency) and DEV ( all other foreign currency). DEV ( all other foreign currency).

7. FISIM allocation by different currencies(continued) FISIM allocation by different currencies(continued) 1. Different internal reference rates were calculated: One internal reference rate for transactions between resident FI’s denominated in HUF (local currency) One internal reference rate for transactions between resident FI’s denominated in HUF (local currency) One internal reference rate for transactions between resident FI’s denominated in DEV (all other foreign currencies) One internal reference rate for transactions between resident FI’s denominated in DEV (all other foreign currencies)

8. FISIM allocation by different currencies(continued) 2. Different external reference rates were calculated: One external reference rate for transactions between resident and non-resident FI’s denominated in HUF (local currency) One external reference rate for transactions between resident and non-resident FI’s denominated in HUF (local currency) One external reference rate for transactions between resident and non-resident FI’s denominated in DEV ( all other foreign currencies) One external reference rate for transactions between resident and non-resident FI’s denominated in DEV ( all other foreign currencies)

9. Data sources on transactions in different currencies: Basic data is supplied by the National Bank : Basic data is supplied by the National Bank : Stock of loans and deposits split by user sectors and by local (HUF) and all other foreign currencies (DEV) Stock of loans and deposits split by user sectors and by local (HUF) and all other foreign currencies (DEV) Accrued interest split by user sectors and by local (HUF) and all other foreign currencies (DEV) Accrued interest split by user sectors and by local (HUF) and all other foreign currencies (DEV)

10. Data sources on transactions in different currencies: (continued) Input data are based on: Input data are based on: Balance sheets and profit & loss accounts of FI’s and Balance sheets and profit & loss accounts of FI’s and Financial Account and BOP compiled by the Central Bank. Financial Account and BOP compiled by the Central Bank. Interest rates statistics collected by the National Bank Interest rates statistics collected by the National Bank

11. How stocks denominated in foreign currencies were converted into local currency? Monthly stock of loans and deposits denominated in different foreign currencies are converted to local currency stocks by applying various end of the month exchange rates. Monthly stock of loans and deposits denominated in different foreign currencies are converted to local currency stocks by applying various end of the month exchange rates. From monthly stocks to quarterly stocks are generated as unweighted averages. From monthly stocks to quarterly stocks are generated as unweighted averages. These data are complied by Central Bank (MNB). These data are complied by Central Bank (MNB).

12. How accrued interest of local currency was calculated ? Monthly stock of loans and deposits denominated in local currency were multiplied by local currency interest rates split by user sectors to get monthly accrued interest. Monthly stock of loans and deposits denominated in local currency were multiplied by local currency interest rates split by user sectors to get monthly accrued interest. Quarterly accrued interest were the total of three monthly figures. Quarterly accrued interest were the total of three monthly figures.

13. How accrued interest of foreign currencies were calculated ? Based on loans and deposits originally denominated in foreign currencies and formerly converted to local currency (HUF) were multiplied by various monthly foreign currency interest rates. Based on loans and deposits originally denominated in foreign currencies and formerly converted to local currency (HUF) were multiplied by various monthly foreign currency interest rates. Quarterly accrued interest was the sum of three monthly accrued interest figures. Quarterly accrued interest was the sum of three monthly accrued interest figures.

14. How the calculated accrued interest is crosschecked with profit & loss accounts? In MNB, accrued interests calculated by user sectors on a monthly basis are crosschecked with total accrual interest of loans and deposits reported in FI’s profit & loss accounts. In MNB, accrued interests calculated by user sectors on a monthly basis are crosschecked with total accrual interest of loans and deposits reported in FI’s profit & loss accounts.

15. Calculation of total FISIM Total FISIM = allocated FISIM to user sectors denominated in local currency (HUF) transactions + allocated FISIM to user sectors denominated in all other foreign currencies (DEV) transactions Total FISIM = allocated FISIM to user sectors denominated in local currency (HUF) transactions + allocated FISIM to user sectors denominated in all other foreign currencies (DEV) transactions

16. Impact of two currencies compared to the single currency (at current prices, million HUF) 2002200320042005 change 69 905 71 343 118 038 70 539 GDP 17 203 730 18 935 672 20 712 284 22 026 763 % of GDP 0.40.40.60.3

17. Impact of two currencies on GDP, at current prices, million HUF

18. Impact of two currencies on final consumption expenditures, at current prices, million HUF Impact of two currencies on final consumption expenditures, at current prices, million HUF

19. Impact of two currencies on GDP, at chain-linked constant prices, million HUF

20. Impact of two currencies on final consumption expenditures, at chain-linked constant prices

21. Impact of two currencies on GNI (at current prices, million HUF) 2002200320042005 change 67 411 70 089 113 635 67 331 GNI 16 259 075 17 986 558 19 493 917 20 759 055 % of GNI 0.40.40.60.3

22. Thank you for your attention!