The accounts must be assessed against the background of Norges Bank's responsibilities. One of the Bank's main responsibilities is the issue of banknotes and coins. This means that the Bank will always have non-interest-bearing debt. The offsetting entry is the Bank's interest-bearing claims on other market participants. The banknote monopoly thus results in central bank accounts which will normally show a profit (seigniorage) prior to adjustments for fluctuations in exchange rates and securities prices.

Norges Bank's results consist primarily of interest and any net exchange gains or losses on foreign exchange reserves. Exchange and capital gains are derived from exchange rate fluctuations, changes in equity prices and interest rate changes that affect bond prices. Norges Bank's results will depend on developments in these variables, which may cause wide annual fluctuations in the Bank's results.

The rise in prices in international securities markets in 2003 resulted in a gain of NOK 4.2 billion, compared with a loss of NOK 2.6 billion in 2002. Due to the depreciation of the Norwegian krone, foreign exchange reserves translated into NOK showed exchange gains totalling NOK 12.3 billion in 2003, compared with exchange losses of NOK 24.3 billion in 2002. The exchange gains due to the depreciation of the krone have no effect on the international purchasing power of the foreign exchange reserves.

At the end of 2003, Norges Bank's international reserves amounted to NOK 202.0 billion at market value and taking into account repurchasing agreements and deposits. This is NOK 31.5 billion more than at end-2002. International reserves comprise foreign exchange reserves, gold and claims on the International Monetary Fund (IMF).

From end-2002 to end-2003, foreign exchange reserves increased by NOK 31.3 billion to NOK 189.1 billion. The increase was mainly due to a positive return of NOK 22.8 billion in 2003. In addition, total foreign exchange transfers from the SDFI, the State's Direct Financial Interest in petroleum activities, and purchases of foreign exchange in the market to build up the Government Petroleum Fund were larger than the total amount transferred to the Petroleum Fund for 2003.

As a result of the year's allocations, the Adjustment Fund amounts to NOK 41.9 billion. As there are no funds in the Transfer Fund, no transfer will be made to the Treasury.