Bundesbank Posts Sharp Drop in 2016 Profit
23 February 2017 - 10:35AM
Dow Jones News
By Tom Fairless
FRANKFURT--Germany's central bank reported a sharp drop in
annual profit on Thursday, as it ramped up its risk buffers to
guard against possible losses when interest rates start to
rise.
Net profit slumped to 399 million euros in 2016 from EUR3.2
billion in 2015.
In a statement, Bundesbank President Jens Weidmann attributed
the drop to setting aside EUR1.8 billion in provisions against
interest-rate risks--a first for Germany's central bank. The move
bolsters the central bank's total risk buffers to a massive EUR15.4
billion.
It shows how the Bundesbank is preparing for an end to the ECB's
easy-money policies, which include long-term loans to banks and a
massive bond-purchase program.
-Write to Tom Fairless at tom.fairless@wsj.com
(END) Dow Jones Newswires
February 23, 2017 05:20 ET (10:20 GMT)
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