Banks, Estonia, Financial Services, Legislation

International Internet Magazine. Baltic States news & analytics Thursday, 23.05.2013, 13:52

Eesti Pank does not wish to share its profits with the state

Juhan Tere, BC, Tallinn, 29.03.2012.Print version
Estonia's central bank Eesti Pank wants to channel all of the profits earned in 2011 into reserves and does not wish to share it with the State Treasury like it has been customary so far, LETA/Postimees writes.

Central bank council member Kalev Kallo and finance minster Jürgen Ligi confirmed that the dispute concerns 5.5 million euros.

 

Eesti Pank's deputy president Ülo Kaasik said that the central bank wants to increase its capital by 1 billion euros. Kaasik said that the bank's equity capital needs to be increased by around 3.5 times from the current 374 million euros since the large loans and bond purchases of the European Central Bank have considerably increased the risks of Eesti Pank.

 

Eesti Pank has not revealed its profit figure of last year but since in earlier years, the central bank has channelled a quarter of its profits into the state stabilisation fund, the profits could have been around 22 million euros.

 

Eesti Pank council discussed the profit distribution on Tuesday but did not reach an agreement.

 

The bank's council chairman Jaan Männik said that the bank's board made the proposal to keep all of last year's profits in the bank's reserves. He added that the bank council will make a decision on the distribution of profit in April.




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