Annual Report 2004

Glossary
ARTIS: Austrian Real Time Interbank Settlement. The real-time gross
settlement (RTGS) system for euro payments developed and operated by
the Oesterreichische Nationalbank (OeNB) that forms the Austrian component
of the EU-wide large-value euro payment system TARGET run by the
European System of Central Banks (ESCB). Since January 4, 1999, ARTIS
users have been able to channel intra-EU payments through a single account
at the OeNB.
BIC: Bank Identifier Code. Eight-digit code devised by SWIFT, the international
messaging system for cross-border payments, that unambiguously
identifies participants of payment systems. It is composed of the following
three subcodes: (1) the bank code (first 4 digits), (2) the country code (next
2 digits), and (3) the location code (last 2 digits). NABAATWW is, for
instance, the BIC of the Oesterreichische Nationalbank.
Budget balance: general government net lending/net borrowing, i.e. the
balancing item of the financial account as defined in ESA 1995 (the European
System of Accounts), which represents either a financial surplus (net lending)
or a financial deficit (net borrowing). AustriaÕs general government sector
comprises the central government (including various nonprofit organizations),
state government and local government as well as social security funds. The
budget balance may be broken down into a cyclical component and a structural,
cyclically adjusted component.
Capital adequacy: the minimum amount of own funds that banks must
hold relative to their assets to cover their exposure to risk. The capital
adequacy framework (Basel I, Basel II) of the Basel Committee on Banking
Supervision (BCBS) prescribes a capital ratio of 8%.
Clearing: the process of reconciling and netting payment orders in a net
settlement system.
Confidence indicator: also referred to as sentiment indicator. Measure
reflecting businessesÕ or the publicÕs assessment of the economic situation,
which serves to e.g. identify cyclical turning points at an early stage.
Convergence criteria: five requirements that are laid down in the
Maastricht Treaty and that an EU Member State must fulfill to qualify for participation
in Stage Three of Economic and Monetary Union (EMU), i.e. for
the introduction of the euro: (1) an inflation rate not more than 1.5 percentage
points above that of the three best-performing Member States in terms of
price stability, (2) a long-term interest rate not more than 2 percentage points
above that of the three best-performing Member States, (3) a government
deficit which does not exceed 3% of GDP, (4) a ratio of public debt to
GDP which does not exceed 60%, unless the ratio is sufficiently diminishing
and approaching the reference value at a satisfactory pace, and (5) currency
variations within the normal fluctuation margins of the Exchange Rate
Mechanism II (ERM II) for at least two years and no devaluation against the
currency of any other Member State.
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Annual Report 2004