The financial crisis of last year and the associated fluctuation in markets, including the plunging of interest rates, produced a record profit for the Reserve Bank of Australia in the year to June 2009, as well as a record dividend payable to the Australian government.The RBA earned a profit $8.8 billion in 2008/09, up from a profit of $1.4 billion in 2007/08. This profit includes net interest earnings of $2.2 billion (about the same as in the prior year) and realised valuation gains of $4.4 billion.Of the realised gains, $2.9 billion were profits from trading in the foreign exchange market and $1.5 billion were from the sale of debt securities.There are also unrealised gains on the portfolio of $2.3 billion, which the RBA said in its annual report were principally owing to the effects of the decline in the Australian dollar on the valuation of foreign assets. Underlying earnings for the year were $2.15 billion, about $80 million more than in 2008.The amount of earnings available for distribution to the Australian Government was $6.6 billion and also a record.Of this the RBA and the government agreed to set aside $577 million to the Reserve Bank Reserve Fund, which now stands at $6.9 billion.The RBA paid a dividend of $6 billion.In the annual report the RBA reminded readers that "were there to be a large rise in either the Australian dollar or local and global interest rates (or both), the Reserve Bank would sustain, as on many past occasions, significant valuation losses."It is entirely possible under such conditions that the Bank could record an overall loss, as it did in 2006/07."