Receive $80 Grab vouchers valid for use on all Grab services except GrabHitch and GrabShuttle when you subscribe to BT All-Digital at only $0.99*/month.
Find out more at btsub.sg/promo
[FRANKFURT] The European Central Bank's profits fell by almost a third in 2014 as interest rates declined, bond holdings matured and creating a new regulatory unit boosted costs.
Earnings slid to 989 million euros (US$1.13 billion) from 1.44 billion euros the previous year, the ECB said in a statement on Thursday. The Governing Council decided to transfer 841 million euros to national central banks at the end of January and will distribute the remainder on Friday.
The Frankfurt-based ECB reduced interest rates to almost zero last year as it tried to stave off the threat of deflation in the euro area. That cut interest income on its refinancing operations just as it was adding staff to take on the responsibility of becoming the region's bank supervisor.
Net interest income dropped to 1.54 billion euros last year from 2.01 billion euros in 2013, with income from interest on banknotes in circulation falling to 126 million euros from 406 million euros. Interest from holdings of government bonds purchased under the Securities Markets Program declined to 728 million euros from 962 million euros as some of that debt matured.
Income on holdings of Greek bonds under SMP fell to 298 million euros from 437 million euros.
The ECB added 15 million euros to its risk provisions, intended to cover potential movements in exchange rates, interest rates, credit and gold prices. The transfer took the provision to its ceiling of 7.58 billion euros.
Staff costs climbed 25 per cent to 301 million euros as the number of employees rose to 2,577 from 1,790. The salary of ECB President Mario Draghi increased 0.4 per cent to 379,608 euros. The chair of the Supervisory Board, Daniele Nouy, had a salary of 271,140 euros.