The Central Bank of The Gambia (CBG) was established
in the Banjul capital in 1971 to take the place of the
Gambia Currency Board which was formed in 1964.
Its main role is to act as banker to the Gambia Government
and the commercial banks. They are also responsible
for providing a secure & efficient payment &
settlement system within the finance sector.
The institution performs its role independently. However,
its role is carried under the general supervision of
the Secretary of State for Finance and Economic Affairs.
In addition, the CBG has a responsibility to carry out
fiscal and monetary policies that have been agreed between
the Gambian authorities and the IMF. Furthermore, it
has a duty to carry out its responsibilities within
the framework of the current economic integration processes
in ECOWAS. The date set for the West African Monetary
Zone (WAMZ) is the 1st December 2009. The CBG job therefore
is to work towards the country fulfilling the primary
and secondary convergence criteria.
The CBG engages in the money market to make sure that
interest rates are matched with the policy position
of the CBG.
The currency department discharges the Bank’s statutory
obligation to ensure that there is enough notes and
coins to meet the demand of the public.
Monetary policy is aimed at keeping domestic inflation
down to single figures. The CBG uses a monetary targeting
framework. It sets an intermediate target for growth
in broad money (as nominal anchor) and uses reserve
money as its operating target. The CBG issues Treasury
Bills as the main instrument for managing reserve money
growth. The Central Bank also has a Monetary Policy
Committee (MPC) to set the rediscount rate every 2 months.
The Central Bank's other functions involve various departments
who issuing (Gambia Government T-Bills) on behalf of
the Government, banking supervision, insurance industry
compliance, licensing foreign exchange bureaus, economic
research, the production of statistics.