(2) Charged on the portion of sight deposits
exceeding the exemption threshold.
It has also proved necessary for banks to have a certain buffer--in other words, banks' aggregate sight deposits
must be of a certain size after Norges Bank has supplied liquidity through monetary policy operations.
Hence, for the rates of return on bank IB sight deposits
and bank time deposits we have used the representative interest rate series calculated internally by one of the largest UK clearing banks.
The banks' sight deposits
held with the SNB fell sharply at the beginning of 1995 and recovered only a little until the summer of 1995.
Currently, the reserve restaurant on sight deposits
in foreign currency is 17.5 per cent as opposed to 16.0 per cent on Turkish lira sight deposits
Assets under management, including sight deposits
, exceed EUR331bn.
Interest on sight deposits
at the SNB is to remain at 0.75% and the target range for the three-month Libor is unchanged at between 1.25% and 0.25%.
This trend reflects a significant decline in sight deposits
among banks and a near stability of the banknotes and currency in circulation.
After recording a decline in Q4-15, quasi money and sight deposits
improved sequentially in Q1-16, it noted.
Time deposits continued to decline for a second consecutive month while sight deposits
recovered by a healthy KWD 80 million from a modest drop last month.
By providing and absorbing liquidity by means of fixed-rate loans and deposits (see separate box for definition), Norges Bank ensures that at the end of each day the banking system has sight deposits
of the order of NOK 5-12 billion in Norges Bank.
For example, the unexpected decline in the SAMB during the second half of 1994, when money market interest rates remained broadly unchanged, but nominal GDP accelerated, appears in part to be caused by another drop in banks' demand for sight deposits
held with the SNB.