Press Release No. : 04/2023
Date : 28 March 2023
The Honourable Deputy Prime Minister and Minister for Finance, Strategic Planning, National Development and Statistics, Professor Biman Prasad, tabled the 2022 financial year (FY) Annual Report of the Reserve Bank of Fiji (RBF) in Parliament on 27 February 2023. The report included the audited accounts and the operations of the RBF for the FY ending 31 July 2022.
The report highlighted the initiatives of the RBF, the range of tools utilised to conduct monetary policy and the appropriate measures implemented to maintain financial stability. The RBF collaborated with financial institutions and the Government to support Fiji’s economy through the COVID-19 pandemic. Monetary policy was accommodative, with the Overnight Policy Rate maintained at 0.25 percent throughout the FY. Furthermore, the RBF expanded its lending facilities to provide concessional funding via banks to eligible businesses to withstand the impact of the COVID-19 crisis. Accordingly, these actions created a low interest rate environment to support Fiji’s economic recovery.
The financial system continued to be stable and weathered the headwinds of the pandemic. The banking sector remained sound on the back of satisfactory capital and liquidity positions. The insurance industry also demonstrated resilience with adequate solvency and liquidity levels, while the Fiji National Provident Fund generated positive investment income and met its mandated solvency and capital requirements.
The domestic economy is estimated to have recovered at a pace of 15.6 percent in 2022, led by tourism and its related sectors, following the full resumption of international travel from December 2021. However, an unexpected challenge throughout 2022 was the rise in inflationary pressures, primarily driven by imported inflation, as the Russia-Ukraine war and the pandemic’s persistent impact on supply chains led to a surge in international food and fuel costs.
Amid evolving uncertainties, the RBF remained committed to fulfilling its mandate of maintaining an adequate level of foreign reserves as well as ensuring price and financial system stability. Foreign reserves stood at a historical high of $3,596.0 million, sufficient to cover 7.3 months2 of retained imports. The annual headline inflation was 5.2 percent at the end of the FY, which has since trended downwards.
Despite the challenges, the RBF reported a stronger financial position in the 2021-22 FY with a net profit of $42.0 million, which is $10.4 million higher than the preceding financial year, mainly underpinned by higher interest income from domestic bonds and increased numismatic sales. A transfer of $44.4 million was made to the Government in September 2022, which comprised a net profit transfer of $41.0 million (after $1.0 million was retained in the RBF’s General Reserve Account) and $3.4 million, which is one-fifth of the Revaluation Reserve Account, as required under subsection 34(3) of the RBF Act.
The RBF Board, management and staff acknowledge with sincere appreciation the contributions, support and guidance of its key stakeholders through the 2021-2022 FY and look forward with confidence to their continued support.
RESERVE BANK OF FIJI
For further details, please contact:-
Communications Office
Telephone: (679) 3223 381 Email: info@rbf.gov.fj
Mr Mervin Singh – Manager Corporate Communications
Telephone: (679) 3223 229 Email: mervin@rbf.gov.fj