State Bank of the German Democratic Republic

the sole bank of issue, payments, clearing, and credit of the country, an agency of the Council of Ministers of the German Democratic Republic for implementation of its credit policy. It was founded in 1948 as part of the reorganization of the Clearing and Issue Bank; up to Jan. 1, 1968, it was called the German Bank of Issue.

The State Bank has a monopoly on issuing bank notes, plans the circulation of money in the country, draws up the annual and long-range credit plans, participates in the working out of the national balance of payments, and proposes suggestions for the improvement of the currency and credit system to the Council of Ministers. The bank carries the accounts of the other state monetary and credit institutions, effects payments in execution of the state budget, and maintains the accounts of several government bodies and social organizations. Since 1968 the bank has had no immediate credit and clearing relations with enterprises and economic organizations. The State Bank of the German Democratic Republic maintains economic relations with commerical banks by way of contracts. In international settlements the bank is authorized to conclude agreements with banks of other countries, settle accounts with foreign banks and international banking organizations, and perform transactions with securities, foreign currency, and gold and other precious metals. The bank has no local branches.