Development and the Role of Central Bank

Share on :

Development and the Role of Central Bank

Not all central banks that exist today than ever since has established as a Central Bank. In Britain and Sweden for example, the beginning of the Central Bank is a commercial bank. In Sweden banks that are now becoming the central bank was established in 1660, new in 1897 but the bank is acting as a central bank. Bank of England, namely the Central Bank in the UK was established in 1694 but its function as the new central bank began to run since 1884.

In the United States central bank called the Federal Reserve System, and the agency was founded in 1913. In the state developing countries, including in the state of Indonesia, the central bank was established since they achieved independence, namely in the years after World War II. Central Banks in Indonesia is Bank Indonesia the previous Bank is De Javasche Bank (the Dutch) are taken in 1953.

Central Bank is defined as a financial institution which is generally owned by the government entrusted with the responsibility to regulate and supervise the stability of financial institutions, and to ensure that the activities of financial institutions that will help create a high level of economic activity and stable.

If noted the role and activities undertaken by the Central Bank in various countries, it will be seen that in general the central bank assigned by the government to run the following five activities:

- Acting as a bank to the government

- Acting as a bank to commercial banks

- Overseeing the activities of commercial banks and other financial institutions

- Overseeing the balance of foreign trade activities

- Printing of coins and paper money needed to launch a production and trading activities. Next.

Healthy | Smart | Rich, at: 5/14/2011