FISIM allocation to FISIM allocation to user sectors by user sectors by

currenciescurrenciesJános Polonkai, Hungarian János Polonkai, Hungarian

CSOCSO

04.10.201004.10.2010

FISIM allocation to user FISIM allocation to user sectorssectors

Legal basis: Legal basis: 448/98 Council Regulation and 448/98 Council Regulation and

1889/02 Commission Regulation1889/02 Commission Regulation

OECD recommendation on national OECD recommendation on national account experts meeting to develop account experts meeting to develop FISIM allocation split by different FISIM allocation split by different currenciescurrencies

History of FISIM History of FISIM allocationallocation

From 1995 to 2004 : by single From 1995 to 2004 : by single currency (HUF)currency (HUF)

From 2005: by local currency (HUF) From 2005: by local currency (HUF) and all other currencies (DEV).and all other currencies (DEV).

FISIM time series at current and FISIM time series at current and constant prices were revised back-constant prices were revised back-casted 1995 by different currencies.casted 1995 by different currencies.

Why did we change our Why did we change our FISIM allocation?FISIM allocation?

We We assumedassumed, that current price , that current price andand constant price FISIM constant price FISIM figuresfigures are are more suitable in national accounts, more suitable in national accounts, than FISIM than FISIM figures figures calculated by calculated by single reference ratesingle reference ratess..

Why did we change our Why did we change our FISIM allocation?FISIM allocation?

- continued -- continued -

OECD recommendation tOECD recommendation to o determine several external reference determine several external reference rates according to currencies rates according to currencies in in order to make FISIM allocation more order to make FISIM allocation more refined.refined.

FISIM allocation by FISIM allocation by different currenciesdifferent currencies

A trial calculation was carried out A trial calculation was carried out for 2000-2005 in 2006 . 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).

FISIM allocation by different FISIM allocation by different currencies(continued)currencies(continued)

1. 1. DifferentDifferent internal reference rates internal reference rates were calculated:were calculated:

One internal reference rate for One internal reference rate for transactions between resident FI’s transactions between resident FI’s denominated in HUF (local currency) denominated in HUF (local currency)

One internal reference rate for One internal reference rate for transactions between resident FI’s transactions between resident FI’s denominated in DEV (all other denominated in DEV (all other foreign currencies)foreign currencies)

FISIM allocation by different FISIM allocation by different currencies(continued)currencies(continued)

2. Different external reference rates 2. Different external reference rates were calculated:were calculated:

One external reference rate for One external reference rate for transactions between resident and transactions between resident and non-resident FI’s denominated in non-resident FI’s denominated in HUF (local currency) HUF (local currency)

One external reference rate for One external reference rate for transactions between resident and transactions between resident and non-resident FI’s denominated in non-resident FI’s denominated in DEV ( all other foreign currencies)DEV ( all other foreign currencies)

Data sources on Data sources on transactions in transactions in differentdifferent

currencies:currencies: Basic data is supplied by the National Basic data is supplied by the National

Bank :Bank :

Stock of loans and deposits split by Stock of loans and deposits split by user sectors and by local (HUF) and user sectors and by local (HUF) and all other foreign currencies (DEV)all other foreign currencies (DEV)

Accrued interest split by user sectors Accrued interest split by user sectors and by local (HUF) and all other and by local (HUF) and all other foreign currencies (DEV)foreign currencies (DEV)

Data sources on Data sources on transactions in different transactions in different

currencies:currencies:(continued)(continued)

Input data are based on:Input data are based on: Balance sheets and profit & loss accounts of Balance sheets and profit & loss accounts of

FI’s andFI’s and Financial Account and BOP compiled by the Financial Account and BOP compiled by the

Central Bank.Central Bank. Interest rates statistics collected by the Interest rates statistics collected by the

National BankNational Bank

How stocks denominated in How stocks denominated in foreign currencies were foreign currencies were

converted into local currency?converted into local currency?

Monthly stock of loans and deposits Monthly stock of loans and deposits denominated in different foreign currencies denominated in different foreign currencies are converted to local currency stocks by are converted to local currency stocks by applying various end of the month exchange applying various end of the month exchange rates. rates.

From monthly stocks to quarterly stocks are From monthly stocks to quarterly stocks are generated as unweighted averages.generated as unweighted averages.

These data are complied by Central Bank These data are complied by Central Bank (MNB).(MNB).

How accrued interest of local How accrued interest of local currency was calculated ?currency was calculated ?

Monthly stock of loans and deposits Monthly stock of loans and deposits denominated in local currency were denominated in local currency were multiplied by local currency interest multiplied by local currency interest rates split by user sectors to get rates split by user sectors to get monthly accrued interest.monthly accrued interest.

Quarterly accrued interest were the Quarterly accrued interest were the total of three monthly figures.total of three monthly figures.

How accrued interest of How accrued interest of foreign currencies were foreign currencies were

calculated ?calculated ? Based on loans and deposits originally Based on loans and deposits originally

denominated in foreign currencies and denominated in foreign currencies and formerly converted to local currency formerly converted to local currency (HUF) were multiplied by various (HUF) were multiplied by various monthly foreign currency interest rates.monthly foreign currency interest rates.

Quarterly accrued interest was the sum Quarterly accrued interest was the sum of three monthly accrued interest figures.of three monthly accrued interest figures.

How the calculated accrued How the calculated accrued interest is crosschecked interest is crosschecked

with profit & loss accounts?with profit & loss accounts?

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

Calculation of total Calculation of total FISIM FISIM

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

ImpactImpact of t of two currencies wo currencies compared to the single compared to the single

currencycurrency

(at current prices, million HUF)

20022002 20032003 20042004 20052005

chanchangege

69 90569 905 71 34371 343 118 038118 038 70 53970 539

GDPGDP 17 203 17 203 730730

18 935 67218 935 672 20 712 20 712 284284

22 026 22 026 763763

% of % of GDPGDP

0.40.4 0.40.4 0.60.6 0.30.3

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

0

50 000

100 000

150 000

200 000

250 000

300 000

350 000

2000 2001 2002 2003 2004 2005

By single referencerates

By two-typereference rates

Impact of two currencies on final Impact of two currencies on final consumption expenditures, at current consumption expenditures, at current

prices, million HUFprices, million HUF

0

100 000

200 000

300 000

400 000

2000 2001 2002 2003 2004 2005

By singlereference rates

By two-typereference rates

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

HUFHUF

0

50 000

100 000

150 000

200 000

250 000

300 000

350 000

400 000

2001 2002 2003 2004 2005

By single referencerates

By two-typereference rates

Impact of two currencies on final Impact of two currencies on final consumption expenditures, at chain-linked consumption expenditures, at chain-linked

constant pricesconstant prices

0

100 000

200 000

300 000

400 000

2001 2002 2003 2004 2005

By single referencerates

By two-typereference rates

ImpactImpact of of two currenciestwo currencies on on GNIGNI

(at current prices, million HUF)

20022002 20032003 20042004 20052005

changechange 67 41167 411 70 08970 089 113 635113 635 67 33167 331

GNIGNI 16 259 16 259 075075

17 986 17 986 558558

19 493 19 493 917917

20 759 20 759 055055

% of % of GNIGNI

0.40.4 0.40.4 0.60.6 0.30.3

Thank you for your attention!Thank you for your attention!