TNAG-0717-FCO40-914-Banking-and-monetary-matters-in-the-Dependent-Territories-is-1978 — Page 130

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sheet, for 100% backing for coins as well as notes in circulation.

However, in 1972 it was decided not to hold reserve assets against numismatic coins ("coin sets"). Note 1B of the Bermuda Monetary Authority's 1972 Report.7

8.13 (10) Although now separated from the Gilbert Islands, Tuvalu

treats as its own legislation the Gilbert and Ellice Islands Coinage

Ordinance, 1975. This provides for the issue of coinage to complement the Australian dollar currency in everyday circulation. All coins. issued under the Ordinance must, implicitly, be fully backed by assets held in the Coin Security Fund (the relative provision is similar to

that in the Cayman legislation), and may be redeemed freely on demand

"with such other currency as is legal tender in the Colony,

and the cost thereof shall be charged upon the Coin Security Fund except that the cost of redemption of coin of an issue which has been demonetised in this case, no longer has legal tender status7 and which is presented for redemption after the date of demonetisation shall be charged upon the Consolidated

Fund".

8.13 (11) The Ordinance (as amended) establishing the Solomon Islands

Monetary Authority (1976) allows for the redemption on demand of both notes and coins, but the Authority is explicitly required to hold

reserve assets (all external) totalling not less than 60% of demand

liabilities. These, under a recent amendment to the Ordinance, are deemed to exclude "numismatic proof and brilliant uncirculated specimen coins". (Section 26, which provides for the inclusion in the reserve fund of the bullion value of any coins issued by the Authority, remains

in force). Legally, however, numismatic coins still constitute a

liability of the Authority, which is required to exchange in perpetuity notes and coins which have ceased to be legal tender.

8.13 (12) The Monetary Authority of Belize Ordinance, 1976, like the Solomon Islands legislation, provides for the exchange of currency only after it has ceased to be legal tender. There is an implicit obligation to exchange in perpetuity, but subject to any conditions that the Authority may impose. There is no explicit right of redemption in an external currency. External reserve assets equivalent to at least 50% of all demand liabilities must be held, but there is no

specific requirement to provide 100% backing for currency in circulation.