Italy cenbank to pay state 615 million euros despite 2023 loss of 7.1 billion
ROME (Reuters) -The Bank of Italy will pay around 615 million euros ($663.65 million) into state coffers despite posting a 2023 gross loss of 7.1 billion euros due to the European Central Bank's restrictive monetary policy, governor Fabio Panetta said on Thursday.
The Bank of Italy results announced by Panetta showed net profit of 815 million euros, of which 200 million will go in dividends to its shareholders made up of banks, insurers and other financial institutions.
"Profit for the state is 615 million euros, down 1,061 million," Panetta said in a speech in Rome.
The bank's financial result excluding taxes was a loss of 7.1 billion euros, which was covered thanks to 5.6 billion euros taken from its risk management fund and to tax-related adjustments.
In 2022 it registered a pre-tax profit of 5.9 billion euros.
Explaining the drivers of the 2023 loss, Panetta said the rise in ECB rates led to an increase in the cost of balance sheet liabilities - mainly banks' deposits.
This was not matched by a corresponding increase in the return on monetary policy assets.
The governor said that losses were common among euro zone central banks last year, and added that the Bank of Italy expects another negative result this year.
"2025 is expected to mark a return to profit," Panetta said.
The balance sheet showed that, as of September 2023, the governor's gross annual salary increased to 480,000 euros from 450,000.
The decision was made in July by the Bank of Italy's Superior Council, then headed by Panetta's predecessor Ignazio Visco. Panetta took over as governor in November.
($1 = 0.9267 euros)
(Reporting by Giuseppe Fonte, editing by Gavin Jones)