Banca d'Italia returns to gross profit in 2025 after two years of losses

Banca d'Italia (BI) recorded a gross profit of €3.0 billion in 2025, a significant turnaround from gross losses of €7.1 billion in 2023 and €7.3 billion in 2024.

This positive shift was in line with previous forecasts.

Following an allocation of €0.9 billion to the general risk provision – the primary financial buffer – and taxes amounting to €0.4 billion, the Bank concluded its 2025 financial year with a net profit of €1.7 billion.

This figure represents a substantial increase compared to the €0.8 billion net profit reported in 2024, reflecting improved financial results after a challenging period for Eurosystem central banks.

The general risk provision had seen a total release of €11.4 billion over the two preceding years to cover those losses.

The financial performance of Eurosystem central banks in recent years has been significantly influenced by the exceptional pace and extent of key interest rate hikes, implemented to combat surging inflation.

While these measures were crucial for price stability, they led to substantial losses for individual central banks.

The negative mismatch between the average return on largely fixed-rate, long-term assets and the increased cost of liabilities (due to higher interest paid on credit institutions' deposits) persisted, even after the reduction in key interest rates began in June 2024.

Despite these financial impacts, the Eurosystem's primary goal remains price stability, not profit generation, and the central banks' ability to fulfil this mandate has not been impaired.