The Bank of Finland has published its Annual Report on the activities in 2012. The Annual Report is available via the Bank's website in Finnish and Swedish, and the English language version will be published on 19 April 2013.

The outlook for the world economy deteriorated in 2012, and the sovereign debt crisis increased uncertainty in the financial markets. In July, the European Central Bank lowered the policy rates in response to receding inflationary pressures and a weakening economic outlook in the euro area. Euro area financial markets calmed down significantly in the latter half of the year following the European Central Bank’s announcement of its readiness to undertake outright monetary transactions, with a view to safeguarding an appropriate monetary policy transmission and the singleness of the monetary policy throughout the euro area. Strict conditionality was attached to the programme, linking the transactions to the macroeconomic adjustment programmes of the countries concerned.

During the year, work was also continued to strengthen European financial market structures. EU Member States reached political agreement on a key component of a banking union – single banking supervision for the euro area. A single banking supervisory authority will be established in connection with the European Central Bank. In parallel with the strengthening of market structures, it is important to move ahead in the area of crisis management and crisis resolution.

Despite stabilisation in the financial markets, the euro area economy contracted markedly in the latter half of 2012. Finland, too, saw its economic prospects weaken in the course of the year, and this has also worsened the outlook for public finances. At the same time, the perspectives for exports and external balance have remained subdued, with a deteriorating trend in our competitiveness.

The Bank of Finland’s profit for the financial year 2012 totalled EUR 337 million. The financial accounts will be published as part of the Annual Report.

For further information, please contact:
Jenni Hellström, Head of Communications, tel. +358 10 831 2632.