The Parliamentary Supervisory Council has today confirmed the Bank of Finland’s financial statements and has, upon proposal by the Bank’s Board, decided that EUR 26 million, i.e. half of the Bank’s profit for the financial year 2021, will be transferred to the State.
The Bank of Finland’s audited profit for the financial year 2021 totals EUR 52 million. According to the Act on the Bank of Finland, half of the Bank’s profit is to be transferred to the reserve fund and the remaining profit made available for use by the State. The Act also allows for a decision to be made to distribute the profit differently if justified by the Bank’s financial condition or the size of the reserve fund.
The Bank of Finland’s income consists primarily of the following: interest income on banknotes and on the Eurosystem’s monetary policy items; investment income on foreign reserves and on other financial assets of the Bank; and its share of the European Central Bank’s profit that is distributed to the euro area national central banks. In 2021, the Bank of Finland’s net interest income amounted to EUR 658 million (2020: EUR 731 million). Interest income was lower than in previous years due to a decrease in interest income on foreign reserves and lower yields on Finnish government bonds. In addition, interest expenses related to targeted monetary policy operations (TLTRO III) increased further, and so the Bank of Finland’s share in the Eurosystem’s monetary income fell to EUR 21 million (2020: EUR 79 million).
“Monetary policy purchases of securities and credit granted to banks continued to enlarge the Bank of Finland’s balance sheet, and interest rates stayed at a low level. To ensure favourable financing conditions, commercial banks were compensated for interest expenses on the targeted refinancing operations, which reduced the Bank of Finland’s profit. The Bank of Finland’s financial position remains solid,” stated Marja Nykänen, Deputy Governor of the Bank of Finland.
The Bank of Finland’s income covers its operating expenses and provisions. Operating expenses, excluding banknote production services and an additional pension fund contribution, amounted to EUR 106 million in 2021 (2020: EUR 99 million).
The Bank of Finland’s financial statements, which also include the income and expenses of the Financial Supervisory Authority, have been published today, 25 March 2022, on the Bank’s website.
For further information, please contact Marja Nykänen, Deputy Governor of the Bank of Finland, tel. +358 9 183 2007.