The framework for the Riksbank's equity in the Sveriges Riksbank Act

Equity is important to the Riksbank because it can absorb losses and is a source of interest-free funding. A high level of equity thus strengthens the Riksbank's financial position and thereby the Riksbank's financial independence. In simple terms, equity increases if the Riksbank has a positive result. Conversely, equity decreases if the result is negative. Similarly, equity increases if the Riksbank receives a capital injection and decreases if the Riksbank distributes capital to the Treasury.

When the law entered into force in 2023, the target level of equity was SEK 60 billion. The target level is adjusted annually with inflation, known as CPI indexation. In addition to the target level, the Riksbank Act also specifies a so-called base level and a lower level for equity. These are two thirds and one third of the target level respectively.

According to the Sveriges Riksbank Act, the Riksbank shall distribute equity in excess of the target level to the Treasury. Conversely, the Riksbank may petition the Riksdag to restore equity if the level of equity plus unrealised gains from the Riksbank’s securities falls below one third of the target level of equity. After restoration, equity plus unrealised gains from the Riksbank's securities should, as a general rule, amount to the base level, but it can be adjusted up to the target level.

Annual report and petition to Parliament

According to the Riksbank Act, each year the Riksbank shall prepare an annual report for the past year, which is submitted to the Riksdag, the Swedish National Audit Office and the General Council of the Riksbank by 21 February each year. According to the Riksbank Act, the General Council of the Riksbank shall decide on the allocation of profits and the Riksdag shall then approve the decision.

If the Riksbank submits a petition to the Riksdag to restore equity, a process follows in which the Riksdag considers and decides on the petition before any capital injection is distributed and the equity is restored.

Interest-free deposits

To strengthen the Riksbank's earnings and financial independence, the Riksbank Act was amended in 2024. As of 1 January 2025, it is possible for the Riksbank to decide that credit institutions in Sweden shall have a certain amount of interest-free deposits at the Riksbank. The level of the interest-free deposits is linked to the framework for the Riksbank's equity (described above). According to the Riksbank Act, the Riksbank may require that credit institutions' total interest-free deposits amount to the difference between the target level and the actual level of equity. This ensures that the Riksbank can always have interest-free funding that amounts to the target level. You can read more about the interest-free deposits here.