The Bhutanese Leading the way.
The Royal Monetary Authority has had a good financial year for itself in 2018 as per its annual report released last week.
The RMA Governor Dasho Penjore in the annual report said, “On the operational front, the RMA successfully closed its accounts for the 2018, and submitted a net surplus of Nu. 1.5 billion to the Royal Government of Bhutan. The net surplus for 2018 was a record high reflecting to some measure the efficiency in overall reserve management.”
The total operating income of the RMA in 2018 was Nu.2.10 billion, which improved by 7.3 percent from Nu.1.95 billion in 2017.
The contributing factor for this improvement was owing to higher interest on foreign investment, interest of ways and means advance from RGOB, commission and fees, income from other sources and other income.
On the other hand, components such as interest on rupee investment, interest on domestic investment, royalty from commemorative coins and sale of foreign currencies experienced a decline in the review period.
The total operating expenses decreased by 13.5 percent from Nu. 385.28 million in 2017 to Nu. 333.38 million in 2018.
The decrease was mainly contributed by extraordinary expenses and hospitality and entertainment by 87.9 percent and 80.8 percent respectively. When the expenses of Nu 333.38 mn was deducted from the income of 2.10 billion the surplus generated during the year was Nu. 1,763.35 million, recording growth of 12.5 percent.
The net surplus of Nu. 1,585.24 million was transferred to the balance sheet of the government.
The total assets and liabilities of the RMA for the year 2018 was Nu. 77.76 billion, which increased by 4.8 percent from Nu. 74.18 billion in 2017.
Total Liabilities of the RMA are made up of three major components, namely the Capital and Reserves, Foreign Liabilities and Domestic Liabilities.
Capital and Reserves increased by 17.5 percent from Nu.17.82 billion in 2017 to Nu. 20.93 billion in 2018. An increase in capital and reserves was driven by the revaluation gain amounting to Nu. 2.94 billion in the year 2018.
There was also an increase of 48.3 percent in the profit in 2018 as compared to 2017. On the other hand, revaluation reserves decreased marginally from Nu.13.95 billion in 2017 to Nu.13.61 billion in 2018.
Foreign Liabilities stood at Nu. 20.23 billion in 2018 which was an increase of 55.3 percent compared to the previous year. This increase was on account of increase in loan to international institutions from Nu. 3.90 billion in 2017 to Nu. 10.85 billion in 2018, on account of the RBI swap facility amounting to INR 6.7 billion.
Concurrently, the amount due to IMF, due to government and interest accrued has increased by 8.4 percent, 25.6 percent and 132 percent respectively.
Domestic Liabilities decreased by 15.5 percent in the year 2018 mainly on account of decrease in sweeping account of banks from Nu. 6.27 billion in 2017 to Nu. 2.81 billion in 2018.
Additionally, the decrease in amount due to banks, due to government, other liabilities and managed fund also contributed to this decrease.
The total assets of the RMA comprises of foreign assets, domestic assets, and non- financial assets.
Domestic Assets increased from Nu. 598.57 million in 2017 to Nu. 750.33 million on account of increase in cash in hand, balances with banks and other financial assets which increased by 487.7 percent, 27 percent and 14 percent respectively.
Non-Financial Assets includes fixed assets, inventories increased by 12.9 percent from Nu.308.29 to Nu. 348.16 million in 2018.
