OREANDA-NEWS. March 23, 2012. The Council of the Bank of Latvia resolved to reduce the Bank of Latvia marginal lending facility rates as follows: the rate to banks that have used the facility no more than 5 working days within the previous 30 day period has been reduced from 7.5% to 5.0%; the rate to banks that have used the facility no more than 10 working days within the previous 30 day period has been cut from 15.0% to 10.0%; and the rate to banks that have used the facility more than 10 working days within the previous 30 day period is down from 30% to 15%, reported the press-centre of Bank of Latvia.

The new marginal lending facility rates will apply as of 24 March 2012. Other interest rates and the minimum reserve ratio set by the Bank of Latvia for banks remain unchanged.

The tensions observed in the Latvian financial markets during the crisis have generally been overcome and the functioning of the interbank market has become more effective as suggested by the developments of December 2011. Stabilisation of the situation enables the central bank to reduce its marginal lending facility rates that were raised at the outset of the financial crisis in December 2008.