Management of the foreign reserves of the European Central Bank has been distributed among the Eurosystem national central banks. The foreign reserves managed on behalf of the ECB comprise assets denominated in US dollars and Japanese yen as well as gold. Foreign reserve management is based on the premise that each national central bank may as a rule manage only one portfolio. At the end of 2010, the Bank of Finland and the Estonian central bank agreed on joint management of the ECB’s foreign reserves following Estonia's accession to Economic and Monetary Union from the beginning of 2011. These two countries’ combined share of the foreign reserves constitutes one investment portfolio, which brings greater efficiency to the overall foreign reserve management within the Eurosystem. The combined share of Finland and Estonia of the ECB’s foreign reserves is denominated in Japanese yen and is managed at the Bank of Finland from the beginning of 2011. Since any foreign exchange intervention by the Eurosystem is conducted using the assets of the ECB, security and liquidity form the basic requirements for the investment of the foreign reserves.
The currency distribution of invested reserves is kept fixed. The ECB sets benchmark portfolios for the currencies in the reserves for the comparison of the returns. The ECB is also responsible for the risk management of its foreign reserves. The value of the foreign reserve portfolio of the European Central Bank was approximately EUR 60.8 billion at the end of 2010. The share of the reserves denominated in yen and managed by the Bank of Finland on behalf of the ECB amounted to about EUR 957 million. The ECB’s Annual Report provides additional information on the management of its foreign reserves.