European Central Bank makes 7.8 billion euro from Greece’s financial crisis

The European Central Bank (ECB) has made €7.8bn in profits from its holdings of Greek government debt, according to a document seen by the Financial Times.

A written response to a request from a Greek MEP showed the bank collected €7.8 billion in interest payments between 2012-2016 on Greek sovereign bonds acquired under its Securities and Markets bond-buying program (SMP).

Profits are usually redistributed among the 19 eurozone central banks.

In 2016, the ECB collected more than €1.1 billion in interest payments on the nearly €20 billion worth of Greek bonds it holds, according to German daily Suddeutsche Zeitung.

An analysis from the Jubilee Debt Campaign estimated Greece’s other creditor, the International Monetary Fund, had made €2.5 billion from its loans to the country.

According to Leo Hoffmann-Axthelm from Transparency International, the ECB’s participation in Greece’s bailout had led to a “conflict of interest.”

The ECB did not give details on the profits accumulated under an agreement with national central banks known as ANFA and said decisions about what to do with the cash would be taken by national member states.

In letter signed by ECB president Mario Draghi, the bank said: “This is a matter of national competence and falls outside the remit of the ECB.

GCT Team

This article was researched and written by a GCT team member.

No Comments Yet

Comments are closed