Market infrastructure - Lithuania
Institutions and organisation
Vilnius Stock Exchange (Nasdaq Vilnius)
The Vilnius Stock Exchange was founded in 1993.
Nasdaq Vilnius is the only regulated secondary securities market in Lithuania. Nasdaq Vilnius is a self regulated organisation, issuing and enforcing its own Rules and Regulations consistent with standard exchange operating procedures. Nasdaq Vilnius is licensed and supervised by the Bank of Lithuania.
Nasdaq Vilnius uses the Nasdaq trading platforms INET and SAXESS, which in addition to Lithuania are used by exchanges in Sweden, Finland, Denmark, Iceland, Estonia and Latvia.
Nasdaq CSD SE
Nasdaq CSD was established through the merger of the Estonian, Latvian and Lithuanian central securities depositiories in 2017. Nasdaq CSD is licensed under the European CSDR and supervised by Baltic regulatory institutions cooperating in accordance with the CSDR.
Although on the same IT platform, Nasdaq CSD operates with three parallel securities settlements systems (SSS). All SSSs are governed by a common set of rules, with local specifics for each SSS indicated in an addendum of the common rules.
Nasdaq CSD is authorised by the Latvian Financial and Capital Market Commission to provide CSD services in Latvia under the CSDR, and in Estonia and Lithuania via its Estonian and Lithuanian branches. Nasdaq CSD acts as the operator of the Lithuanian securities settlements system, which is governed by Lithuanian laws. Through Nasdaq CSD, market participants are provided with an environment for carrying out transactions with securities, settlement of securities transactions and registration of securities. Cash is cleared through the TARGET2 system.
The depository is 100% owned subsidiary of Nasdaq Nordic Ltd, a stock exchange holding company in Finland.
Regulatory structure
National Central Bank
The Bank of Lithuania is the central bank of the Republic of Lithuania. Its principal objective is to maintain price stability. In seeking its principal objective, the Bank of Lithuania is independent from the Government of the Republic of Lithuania or other institutions of the state.
In implementing the primary objective, the Bank of Lithuania performs the following functions:
- Formulating and implementing monetary policy;
- Managing, using and disposing of foreign reserves of the Bank of Lithuania;
- Acting as a State Treasury agent;
- Issuing and revoking licenses of credit institutions of the Republic of Lithuania and permissions for the establishment and operation of branches and representative offices of credit institutions of foreign states, supervising their activities and establishing the principles and procedures for financial accounting and reporting;
- Developing and managing an inter-bank funds transfer system and establishing the requirements for the participants of the inter-bank funds transfer system;
- Collecting monetary, banking and balance of payments statistics, as well as data on Lithuanian financial and related statistics, implementing standards on the collection, reporting and dissemination of such statistics and compiling the balance of payments of the Republic of Lithuania;
- Establishing principles and procedures for financial accounting and reporting of credit institutions of the Republic of Lithuania and branches of credit institutions of foreign states operating in the Republic of Lithuania;
- Encouraging stable and efficient operation of payment and securities settlement systems.
The Bank of Lithuania also acts as clearing bank. Its payment system LITAS guarantees execution of against payment settlement transactions between financial brokerage firms or specialised financial brokerage units of banks (FBFs) and banks according to settlement instructions received from Nasdaq CSD.
Within the range of its competence, the Bank of Lithuania seeks to ensure the security, soundness, transparency and competitiveness of the domestic system of financial services. The Bank of Lithuania issues licences to financial market participants for the provision of financial services and supervises their activities. As a supervisory authority, the Bank of Lithuania monitors the compliance of financial market participants with laws and requirements set by legal acts of the Bank of Lithuania, International Financial Reporting Standards, requirements recommended by international organisations for safe and sound activities.