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ECB cuts dividend payment to euro zone central banks

·1-min read
European Central Bank headquarter in Frankfurt

FRANKFURT (Reuters) - The European Central Bank will pay the currency bloc's 19 central banks 1.6 billion euros in dividends this year, down from the 2.4 billion euros it paid a year ago as its profit declined, it said in a statement on Thursday.

The ECB's net profit for 2020 fell to 1.64 billion euros from 2.37 billion a year earlier, mostly on a drop in net interest income to 2.02 billion euro from 2.69 billion euros.

With the 19 central banks holding the vast majority of the bonds bought under the ECB's stimulus schemes, most of the profit is also generated on their balance sheet, so the ECB's dividend is merely a top off.

National central banks then typically pay most of their profits into state coffers.

(Reporting by Balazs Koranyi; Editing by Francesco Canepa)