By Muhammed Ali Gurtas
ANKARA (AA) - The European Central Bank's (ECB) net profit rose by nearly 7 percent year-on-year to reach €1.3 billion ($1.47 billion) in 2017, according to an official release on Thursday.
The €82 million annual hike in net profit resulted from "higher net interest income earned on the U.S. dollar portfolio and the asset purchase program (APP) portfolio," the bank said.
According to the statement, the bank's net interest income totalled €1.81 billion in 2017, while it was €1.65 billion in the previous year.
"Net interest income on foreign reserve assets increased to €534 million (from €370 million in 2016) owing to higher interest income earned on the US dollar portfolio," it said, adding net interest income arising from the APP increased by €140 million to €575 million, as a result of the continuing securities purchases under this program.
About the bank's declining revenues from its financial operations -- falling to €161 million last year, down from €225 million in 2016 -- the ECB said that the decrease in net realized gains was mainly due to lower price gains on U.S. dollar securities.
The fees charged to supervized entities, to recover expenses incurred by the ECB in the performance of its supervisory tasks, amounted to €437 million in 2017, versus €382 million in the previous year, the bank noted.
"Total staff costs and other administrative expenses increased to €535 million (from €467 million in 2016) and €539 million (from €487 million in 2016) respectively, mainly owing to the increase in expenses related to the ECB’s supervisory tasks," it said.
The ECB also stated that the bank's balance sheet increased by 19 percent year-on-year to stand at €414 billion, noting that this increase was almost exclusively due to the securities purchased under the APP.
*The average EUR/USD rate was 1.13 last year.