Opinion of the European Central Bank of 29 October 2012 on profit distribution between the Nationale Bank van België/Banque Nationale de Belgique and the Belgian State (CON/2012/81)
Date: 2012-10-29
Institutions: European Central Bank
Subjects: Belgium, central bank, financing method, national law, profit

EN 

ECB-PUBLIC 

OPINION OF THE EUROPEAN CENTRAL BANK 

of 29 October 2012  

on profit distribution between the Nationale Bank van België/Banque Nationale de Belgique and 

the Belgian State  

(CON/2012/81) 

Introduction and legal basis 

On 4 October 2012, the European Central Bank (ECB) received a request from the Nationale Bank van 

België/Banque Nationale de Belgique (NBB), acting on behalf of the Belgian Minister for Finance, for 

an  opinion  on  a draft law repealing  a  profit distribution  rule between the  NBB  and the  Belgian  State 

and  amending  the  Law  of  28  July  1948  on  the  reorganisation  of  the  balance  sheet  of  the  NBB 

(hereinafter the ‘draft law’). 

The ECB’s competence to deliver an opinion is based on Articles 127(4) and 282(5) of the Treaty on 

the  Functioning  of 

the  European  Union  and 

the 

third 

indent  of  Article 2(1)  of  Council 

Decision 98/415/EC  of  29 June  1998  on  the  consultation  of  the  European  Central  Bank  by  national 
authorities  regarding  draft  legislative  provisions1,  as  the  draft  law  relates  to  the  NBB.  In  accordance 

with  the  first  sentence  of  Article 17.5  of  the  Rules  of  Procedure  of  the  European  Central  Bank,  the 

Governing Council has adopted this opinion.  

1. 

Purposes of the draft law 

The draft law aims to delete, from 1 January 2012, the third paragraph of Article 3(b) of the Law on the 

reorganisation of the balance sheet of the NBB, which provides for a stand-alone obligation of the NBB 

to pay the Belgian State an annual amount of 986 million Belgian francs (EUR 24.4 million).  

The  purpose  of  this  obligation,  introduced  in  1991,  was  to  neutralise  the  Belgian  State’s  additional 

annual  expenditure  resulting  from  the  one-off  conversion  of  the  NBB’s  consolidated  claim  on  the 

Belgian State into freely markeatable securities bearing interest at market rates for a total of 34 billion 

Belgian francs. Pursuant to the distribution rules in force at the time, the Belgian State was to receive 

the net financial proceeds in excess of 3% of the difference between the average amount of the NBB’s 

interest-bearing assets and remunereated liabilities calculated on an annual basis. Taking into account 

an  adjustment  of  0.1%  out  of  this  3%  (due  to  the  partial  compensation  for  the  maintenance  of  the 

banknotes  in  circulation),  the  application  of  the  ‘3%  rule’  to  the  34  billion  Belgian  francs 

corresponding to the aggregate amount of freely markeatable securities bearing interest at market rates 

1  

OJ L 189, 3.7.1998, p. 42.  

 
 
 
 
                                                
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booked  in  the  NBB’s  balance  sheet  resulted  in  an  amount  of  EUR  24.4  million2.  Subsequently, 

Article 2 of the Law of 3 April 2009 amending the financial provisions of the Law of 22 February 1998 

establishing  the  Organic  Statute  of  the  Nationale  Bank  of  België/Banque  Nationale  de  Belgique 

(hereinafter the ‘Organic Statute of the NBB’) repealed the ‘3% rule’. Article 3 introduced a new profit 

distribution rule in Article 32 of the Organic Statute of the NBB according to which the NBB’s annual 

profits  are  allocated  as  follows:  (a)  from  the  excess  of  NBB  annual  profits  after  allocation  to 

shareholders of a first dividend of 6% of the NBB’s capital, an amount proposed by the NBB’s Board 

of Directors and established by its Council of Regency is independently allocated to the reserve fund or 

to the available reserves; (b) from the remaining profits a second dividend established by the Council of 

Regency of a minimum of 50% of the net proceeds from assets forming the counterpart to the reserve 

fund and available reserves is allocated to shareholders; and (c) finally, the balance is allocated to the 

State. Articles 2 and 3 of that law entered into force on 1 January 2009. The ECB was consulted on this 

new profit distribution rule and adopted Opinion CON/2009/4. 

2.  General observations  

Any  transfer  of  a  national  central  bank’s  resources  to  a  Member  State,  either  in  the  form  of  a  profit 

distribution  scheme  or  any  equivalent  form,  needs  to  comply  with  the  limitations  imposed  in  this 

respect  by  the  Treaty,  in  particular  with  the  principle  of  central  bank  independence  pursuant 

to Article 130  of  the  Treaty,  and  with  the  prohibition  on  monetary  financing  laid  down  in 
Article 123(1)3. 

3. 

Specific observations 

The  draft  law  repeals  the  stand-alone  obligation  of  the  NBB  to  pay  on  a  yearly  basis  to  the  Belgian 

State a fixed amount of EUR 24.4 million. The ECB understands that since the repeal of the ‘3% rule’ 

in 2009, the NBB has continued to pay this stand-alone amount, which was, however, computed in its 

annual  accounts  as  an  expense,  thereby  deducting  from  the  total  amount  of  distribution  made  to  the 
State  in  accordance  with  Article  32  of  the  Organic  Statute  of  the  NBB4  the  amount  of 

EUR 24.4 million.  As  this  obligation  is formally  incompatible  with the (new) profit  distribution rules 

contained in Article 32 of the Organic Statute of the NBB, repealing it removes the risk of inconsistent 

profit allocation. These profits will now be exclusively governed by the Organic Statute of the NBB. In 

addition, the ECB understands that the agreement between the NBB and the Ministry of Finance setting 

out the details of the application of Article 3(b) of the Law on the reorganisation of the balance sheet of 

the NBB is terminated. This would, in turn, strengthen the overall financial independence of the NBB, 

whose discretion will no more be restricted by requirements to take into account fixed annual payments 

to the Belgian State.  

2  

3   
4   

See  the  preparatory  work  of  the  draft  law  on  public  debt  market  and  monetary  policy  instruments,  Senate,  1001-1 
(1990 – 1991), p. 6 and 21. 
See for example CON/2011/91 paragraph 2 and CON/2011/99 paragraph 2.3. 
See the annual accounts and reports for the financial year 2011, p. 63 (section 6) and p. 78, including footnote (1). 

2 

 
 
                                                
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This opinion will be published on the ECB’s website.  

Done at Frankfurt am Main, 29 October 2012. 

[signed] 

The President of the ECB 

Mario DRAGHI 

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