Public service function refers to the financial services provided by the central bank as a bank to the government, banks and other financial institutions. The services provided by the central bank to the government mainly include raising funds for the government (acting as an agent for treasury revenue and expenditure), issuing government bonds and repaying debts when due.
The state is responsible for international reserves, such as gold foreign exchange transactions. The services provided by the central bank to banks and other financial institutions mainly include the deposit reserve of banks, financing, payment and liquidation services of financial institutions and services provided to the society.
Financial supervision function. It refers to a series of activities that the central bank supervises and restricts financial institutions, their businesses and financial markets according to law, and promotes their steady operation according to law.
Extended data
The fundamental goal of monetary policy and financial supervision is the same:
Monetary policy requires the central bank to proceed from the overall economy, maintain the good operation of the payment and settlement system with the banking industry as the main body, realize the stability of the currency, promote the goal of economic growth, and protect the interests and welfare of the public.
The function of financial supervision is to ensure the long-term solvency of financial institutions, safeguard the interests of creditors, promote moderate and orderly competition and steady operation of the financial industry, and thus realize the stability of the financial system. Monetary policy and financial supervision are two inseparable aspects of economic development.
The implementation of monetary policy and the function of financial supervision are highly complementary;
This complementarity is mainly manifested in:
First of all, a safe and effective financial system is an important prerequisite for the effective transmission of monetary policy. If the financial system is unstable, it will increase the implementation cost of monetary policy and affect the implementation effect of monetary policy.
Second, the adjustment of the central bank's monetary policy must grasp the detailed information of financial institutions, so as to make a correct judgment on financial operation and possible problems in financial operation. In this way, the management information of banks and other financial institutions, such as capital adequacy ratio and liquidity status, mastered by the regulatory authorities is an important basis and guarantee for the central bank to formulate and implement monetary policy.
Third, currency stability is an important basis for improving the effectiveness of financial supervision.
References:
Baidu encyclopedia-bank
References:
Baidu encyclopedia-the function of the central bank