The Bank of Finland’s Parliamentary Supervisory Council has confirmed the central bank’s 2025 financial statements, with audited profit after reductions in provisions again totalling EUR 0.00. The Bank recorded an operating loss of EUR -215 million, which was covered by reducing the provision against real value loss, and attributed the continued weakness in operating profit primarily to interest paid on commercial banks’ deposits at the central bank. The Bank linked the losses to structural interest rate risk stemming from the Eurosystem’s monetary policy purchase programme, which created liquidity that became interest-bearing deposit liabilities on the balance sheet. Despite a 2 percentage point decline in the interest payable on bank deposits since June 2024, interest expenses on excess liquidity still exceeded income from monetary policy and financial asset instruments. The average deposit facility rate in 2025 was 2.26%, with interest paid of EUR -1,892 million (2024: 3.73% and EUR -3,697 million), and net interest income was EUR -227 million, EUR 881 million higher than in 2024. Holdings of monetary policy-related securities, mainly Finnish government bonds, fell from EUR 82 billion to EUR 71 billion, with the Bank noting these long-term bonds and the corresponding deposit liabilities will remain on the balance sheet for a considerable time; central banking profit was EUR -122 million and combined operating expenses and income of the Bank of Finland and the Financial Supervisory Authority, excluding banknote production services and the pension fund contribution, amounted to EUR -78 million. The financial statements, which include the income and expenses of the Financial Supervisory Authority, have been published in Finnish on the Bank of Finland website, with Swedish and English versions due in April.
Bank of Finland 2026-03-13
Bank of Finland reports EUR 215 million operating loss for 2025 while audited profit remains at zero
The Bank of Finland's Parliamentary Supervisory Council confirmed the 2025 financial statements, showing an audited profit of EUR 0.00 after reductions in provisions. The Bank recorded an operating loss of EUR 215 million, primarily due to interest paid on commercial banks' deposits, linked to structural interest rate risk from the Eurosystem's monetary policy purchase programme. Despite a decline in interest payable since June 2024, interest expenses on excess liquidity surpassed income from monetary policy and financial asset instruments.