Page | 45Banking and Currency
Mongolia’s official unit of currency is the tögrög
(currency code MNT). During 2010, the tögrög
(MNT) rose 15% against the U.S. dollar, the
largest increase against the dollar of any world
currency, primarily because of Mongolia’s natural
resources.241, 242 As of mid-April 2011, the dollar-
to- tögrög exchange rate was 1 USD = 1,200
MNT, compared with a rate of 1 USD = 1,400
MNT one year prior.^243
Mongolia’s banking system consists of the Bank
of Mongolia (the Central Bank) and 16 commercial banks (two of which are in
bankruptcy proceedings as of early 2011).
(^244) Numerous other financial institutions—such
as insurance companies, securities companies, and savings and loan cooperatives—also
exist, but their total assets are negligible compared to those of the banks.^245 All but one of
the banks are privately owned. The recession of 2008–2009 caused liquidity problems for
many of these banks, as individuals began withdrawing their savings deposits in fear of a
banking collapse. In addition, the number of non-performing loans jumped during this
period.^246
(^241) Alex Frangos, “Hot Money Roils Growth Currencies,” Wall Street Journal, 3 January 2011,
http://online.wsj.com/article/SB10001424052748703814804576035533789268602.html?mod=googlenews
_wsj
(^242) Mongolian Views, “World Bank Outlines Mongolia’s Economic Trends,” Mongol Messenger, 2 January
2011, http://www.mongolianviews.com/2011/02/world-bank-outlines-mongolias-economic.html
(^243) XE.com, “XE Currency Charts (USD/MNT),” 11 April 2011,
http://www.xe.com/currencycharts/?from=USD&to=MNT
(^244) Tsolmon Erdene, “Mongolia: Banking Sector,” Economic Research Institute for Northeast Asia,
December 2010, 3, http://www.erina.or.jp/en/Research/dp/pdf/1004e.pdf
(^245) Tsolmon Erdene, “Mongolia: Banking Sector,” Economic Research Institute for Northeast Asia,
December 2010, 3, http://www.erina.or.jp/en/Research/dp/pdf/1004e.pdf
(^246) Tsolmon Erdene, “Mongolia: Banking Sector,” Economic Research Institute for Northeast Asia,
December 2010, 5, http://www.erina.or.jp/en/Research/dp/pdf/1004e.pdf