According to the Statute of Eesti Pank, the basis of the financial activity of Eesti Pank is the budget approved by the Governor. The preparation of the budget of Eesti Pank is the responsibility of the Executive Board. Prior to the approval of the budget by the Governor, the Executive Board introduces the draft budget and the principles underlying the compilation of the budget to the Supervisory Board. The Executive Board reports on budget execution to the Supervisory Board at least three times a year.
The compilation of the budget is based on Eesti Pank's strategic goals for the next three years. The strategic plan is reviewed each year, after which the Executive Board sets budget growth limits for the next financial year. In recent years, it has been 75% of the expected nominal GDP growth. The reference base is the actual expenditure incurred over the past 12 months. The limit does not apply to costs related to the production of cash, to an increase in the number of payments settled via interbank settlement systems managed by the central bank, and to ensuring the business continuity of interbank settlement systems. The budget of the central bank consists of the cost budget and fixed assets procurement budget.
The costs of Eesti Pank are fully covered by investment income earned on foreign reserves. Eesti Pank makes allocations from its annual profits to the state budget pursuant to subsection 30 (5) of Eesti Pank Act. The size of the allocations is approved by the Supervisory Board. Eesti Pank does not receive any allocations from the state budget.