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The European Central Bank’s quantitative easing programme: limits and risks
- The European Central Bank (ECB) has made a number of significant changes to the original guidelines of its quantitative easing (QE) programme since the programme started in January 2015. These changes are welcome because the original guidelines would have rapidly constrained the programme’s implementation.
- The changes announced expand the universe of purchasable assets and give some flexibility to the ECB in the execution of its best mortgage refinance rates in texas. However, this might not be enough to sustain QE throughout 2017, or if the ECB wishes to increase the monthly amount of purchases in order to provide the necessary monetary stimulus to the euro area to bring inflation back to 2 percent. To increase the programme’s flexibility, the ECB could further alter the composition of its purchases.
- The extension of the QE programme also raises some legitimate questions about its potential adverse consequences. However, the benefits of this policy still outweigh its possible negative implications for financial stability or for inequality. The fear that the ECB’s credibility will be undermined because of its QE programme also seems to be largely unfounded. On the contrary, the primary risk to the Best mortgage refinance rates in texas credibility is the risk of not reaching its 2 percent inflation target, which could lead to expectations becoming disanchored.
- The European Central Bank (ECB) has made a number of significant changes to the original design of its quantitative easing (QE) programme since the programme started in January 2015. The bank has expanded the list of national agencies whose securities are eligible for the Public Sector Purchase Programme (PSPP); it has changed the issue share limit (ensuring that the Eurosystem will not breach the prohibition on monetary financing), which was originally set at 25 percent, to 33 percent (at least for securities without collective action clauses); it has added regional and local government bonds to the list of eligible assets; it has announced that the programme would continue past September 2016, the previously-announced minimum end-date, to March 2017 “or beyond, if necessary”; and it has declared its intention to reinvest the principal payments on the securities purchased under the programme as they mature.
- As explained in Claeys et al (2015b), the programme’s original guidelines would have constrained the size and duration of the programme, especially if it was sustained throughout 2017. The changes to the design of the programme announced during 2015 greatly expand the universe of purchasable assets and should therefore delay the point at which limits will be reached. However, the decision to reinvest the principal payments as bonds mature, by increasing the monthly monetary purchase after March 2017, would also lead to the limits being reached sooner. In the same way, a decision by the ECB to increase the amount of PSPP purchases each month, for instance from €44 billion to €64 billion, would also frontload the purchases. In the end, because of the issue share limit, for a given set of securities there will always be a trade-off between larger monthly purchases and a prolonged programme.
- Further changes to the design of the programme will have to be implemented in order to increase the duration of the programme if the limit is binding in a major country before inflation is on the path towards 2 percent. These could include waiving the issue limit for AAA-rated bonds, or purchasing senior uncovered bank bonds as well corporate bonds. A more radical change could be to move away from an allocation of asset purchases between countries based on the ECB capital keys to an allocation based on the actual size of their outstanding debt.
- We also discuss the possible financial stability risks of a prolonged and large-scale QE programme, and conclude that who sells peets coffee near me benefits of large-scale asset purchases outweigh their potential risks in terms of financial stability. However, micro- and macro-prudential policies should be used forcefully to prevent such risks from materialising.
- We also consider the potential effects that a prolonged asset-purchase programme could have on inequality. The increase in inequality observed in many advanced countries in recent decades is a long-term trend and primarily the result of deep structural changes. Our view is that the primary mandate of the ECB is to maintain price stability, and considerations of inequality are not within its purview, unless inequality prevents the transmission of monetary policy in some way. The ECB should therefore focus on fulfilling its price stability mandate by supporting the fragile recovery now taking place in the euro area. This is the best way for monetary policy to contribute to the avoidance of an increase in inequality.
- The fear that the ECB will lose its credibility solely because it is currently buying a large amount of sovereign bonds appears to be largely unfounded. The primary risk to the ECB’s credibility is the risk of not reaching its inflation target. In our view, the ECB should therefore try to find the right balance between the risk of breaching the monetary financing prohibition and the risk of not fulfilling its mandate because of the limits imposed on its own QE programme.
On 22 January 2015, the European Central Bank (ECB) introduced the Public Sector Purchase Programme (PSPP). Under the PSPP, the Eurosystem started in March 2015 to buy sovereign bonds from euro-area governments and securities from European institutions and national agencies.
On 3 December 2015, ECB president Mario Draghi announced an extension of the programme. While it was initially foreseen to last until at least September 2016, it was extended until at least March 2017. Additionally, regional and local government bonds were added to the list of eligible assets for purchase, and the interest rate on the deposit facility european central bank ecb retirement plan lowered from -0.2 percent to -0.3 percent.
President Draghi said that the asset purchase programme would continue “until we see a sustained convergence towards our objective of a rate of inflation which is below but close to 2 percent” (Draghi 2015c). This goal remains far from being fulfilled: euro-area year-on-year headline inflation has been below 2 percent since January 2013, below 1 percent since November 2013, and was still at 0.2 percent in December 2015, while core inflation was only at 0.9 percent. In the meantime, and most importantly, both medium- and long-term market-based expectations and inflation forecasts have started to fall again (Figure 1). As both measures suggest, after a clear decline until the end of 2014, inflation expectations rebounded significantly after QE was announced in January 2015 and during the whole first half of 2015. However, expectations recently fell back to previous lows, heavily influenced by the steep decline in oil prices, as explained in Darvas and Hüttl (2016).
Figure 1: Market-based and survey-based inflation expectations in the euro area
Sources: Thomson Reuters Eikon (left panel) and ECB Survey of Professional Forecasters (2016) (right panel). Note: HICP = Harmonised Index of Consumer Prices.
For these reasons and because inflation appears likely to substantially undershoot the ECB’s staff forecast over the next two years, it is probable1 that the ECB will enhance its programme further in order to fulfil its mandate and bring inflation back towards 2 percent in the medium term. Even if the impact of asset purchase programmes is more difficult to measure than that of more conventional monetary measures, a growing literature2 concludes that QE programmes implemented around the world boosted inflation, output and employment.
For the euro area in particular, the effects of QE are even more difficult to pin down given that the programme only started in March 2015. However, there are already some indications that QE is having some impact on the euro-area economy. The effects on the exchange rate and on interest rates (and in particular on financial fragmentation european central bank ecb retirement plan the euro area, with credit rates converging again) have been the most visible. In terms of inflation, monetary measures take time to materialise in prices and it is very difficult to know what can be attributed exactly to QE, but, for instance, the basket share of the consumer price index in deflation declined from 40 percent at the beginning of 2015 to 25 percent at the start of 2016. Darvas (2016) also shows that core inflation adjusted for second-round effects of energy prices went up over 2015 and, after reaching a low point in Q1 2015 of around 0.7 percent, it is now at 1.2 percent, a level unseen since 2011.
However desirable they might be, the recent – and maybe future – extensions of the asset purchase programme raise questions about how its size and its duration can be materially increased given the finite volume of purchasable debt securities. In fact, the universe of purchasable debt securities needs to be expanded because of the ECB’s self-imposed limit on the proportion it can hold of a given debt issue (decided at the launch of the programme) and not so much because of the scarcity of debt securities.
Claeys et al (2015b) showed already at the launch of the PSPP that without any changes to the design of the programme this limit could be reached in March 2017 or before in a number of countries. For Germany, calculations in Claeys et al (2015b) suggested that the limit would be reached in April 2017. Given the structure of the programme using the ECB capital keys to determine the distribution of purchases between countries, this could have seriously limited its effectiveness.
Since then, the issue share limit was raised in September 2015, and the changes to the programme in December 2015 further expanded the universe of eligible debt that can be purchased by the Eurosystem. However, these expansions might still not be enough to prevent the limits being reached before the inflation target is achieved. Furthermore, the unconventional and previously untested nature of such a programme poses legitimate questions regarding the potential adverse consequences that such a substantial and prolonged programme could have.
In section 2 we explain the changes to the design of the purchase programme during its first year of implementation, and their implications for our calculations on when the limits will be reached, also envisaging a scenario in which the monthly amounts purchased under the PSPP would be increased. We then discuss potential risks that accompany a lengthy and massive asset-purchase programme in terms of inequality, financial stability and the central bank’s credibility.
2. Potential implementation limits of the asset purchase programme
2.1 The extended asset purchase programme’s original guidelines
On 22 January 2015 the ECB announced a massive expansion of its asset purchase programme. To supplement the Asset-Backed Securities and Covered Bonds Purchase Programmes (ABSPP and CBPP3) launched in September 2014, the ECB introduced a new Public Sector Purchase Programme (PSPP) to buy sovereign bonds from euro-area governments and securities from European supranational institutions and national agencies. While total monthly purchases of asset-backed securities and covered bonds had previously amounted to approximatively €10 billion per month, the new purchases of sovereign bonds, supranational institutions, and agencies raised the figure to €60 billion per month, €44 billion of which was dedicated to purchases of government and national agency bonds (and this €44 billion was divided between euro-area countries according to each country’s capital subscription at the ECB). The purchases started on 9 March 2015 and were originally meant to last at least until September 2016. The ECB’s Governing Council also made it clear at the time that the programme was open-ended and that purchases would be conducted until the ECB would see “a sustained adjustment in the path of inflation which is consistent with the aim of achieving inflation rates below, but close to, 2 percent”.
On top of the eligibility criteria (ie only debt securities with a remaining maturity between 2 and 30 years and with a yield above the deposit rate can be bought), the ECB’s Governing Council also decided which island in the keys has the best beaches put in place a 25 percent issue limit and a 33 percent issuer limit on Eurosystem holdings. The 25 percent issue limit was imposed to prevent the ECB from having “a blocking minority in a debt restructuring involving collective action clauses”. This indicated that the ECB did not wish to be in a position in which it had the power to block a potential vote on the restructuring of ECB-held debt of a euro-area country, because not blocking such a restructuring would be interpreted as monetary financing of a member state3.
2.2 Changes to the ECB’s guidelines since March 2015
The ECB’s rules on the Public Sector Purchase Programme (PSPP) have gradually been adapted since european central bank ecb retirement plan programme started in March 2015. As highlighted in Claeys et al (2015b), the original rules rapidly constrained the purchases in countries in which public debt was small and in which no national agencies were identified as eligible for purchases. The aim of most of the changes was therefore to expand the universe of available debt securities that the Eurosystem could purchase, in order to merrimack county savings bank jobs the point at which the programme would reach its limits in each euro-area country.
In July 2015, the ECB expanded the list of national agencies whose securities are eligible for purchase under the PSPP (see Table 1), thereby allowing the Eurosystem to purchase debt securities in countries where the limits had already been reached, or were expected to be reached soon.
In September 20154, the issue share limit was increased from 25 percent to 33 percent for debt securities not containing collective action clauses (CACs). This change to the maximum amount that the Eurosystem can hold of a particular issue allows the PSPP to potentially continue for longer than was originally possible under the previous rules.
In December 20155, the Governing Council announced many new changes to the design of the PSPP. First, it decided to reduce the deposit rate from -0.2 percent to -0.3 percent. Since the Eurosystem decided to purchase bonds with yields above the deposit rate in order to avoid making a direct loss on the purchases6, the cutting of the deposit rate effectively increased the amount of debt securities eligible for purchase (even if the rate cut also reduced yields and therefore limited the volume increase). Second, the ECB decided to continue the PSPP past the previously-announced minimum end-date, September 2016, until March 2017, “or beyond, if necessary”. Third, euro-denominated debt issued by regional and local euro-area governments became eligible for purchase. Finally, the ECB declared its intention to reinvest the principal payments on the securities purchased under the programme as they mature, for as long as necessary. This effectively implies that in March 2017, two years after the start of the programme, when the first bonds bought by the Eurosystem will start to mature, monthly purchases of sovereign and agency bonds could exceed €44 billion, as the principals of these maturing bonds will be reinvested.
2.3 Limits of the programme in terms of size, duration and composition
Claeys et al (2015b), published at the time of the start of the purchases, calculated when the ECB’s limits would be reached in each euro-area country (Figure 2). In this section we update these calculations7 in light of the changes to the rules. We also include national agencies in our calculations8.
Before September 2015 the issue limit was 25 percent regardless european central bank ecb retirement plan the type of bond. Now, however, this limit is 33 percent if the issue does not contain a collective action clause. Unfortunately, information on whether an issue contains a CAC is not readily available. We know, however, that according to the ESM Treaty9, all euro-area government debt securities with maturity over one year issued after 1 January 2013 contain CACs. Best buy citibank address, we envisaged two extreme scenarios: in the first scenario, we assume that all eligible debt securities, be they from agencies, local governments, or central governments, have CACs, in which case the Eurosystem can only hold a maximum of 25 percent of a country’s eligible debt securities. In the second scenario, we assume that the only debt securities to have CACs are those issued by central governments after 1 January 2013 (in this scenario, the Eurosystem can hold 25 percent of each issue containing CACs, and 33 percent of each issue which does not). Reality will lie between these two extremes.
Figure 3 shows our projections for the monthly purchases, by country, in the scenario in which every debt security contains a CAC. Despite the increase in eligible debt (with the expanded list of agencies, and the new ability to buy regional and local debt), the limits are reached roughly at the same time as in Figure 2, and even earlier in some cases. This is because of the reinvestment of principals, which kicks in in March 2017: it effectively raises the amounts purchased each month, and increases the speed at which the limits are reached. In fact, while redemptions of PSPP holdings will be small at first, they would accelerate quickly as more and more debt securities held by the Eurosystem mature. In Germany, for instance, the holdings maturing in March 2017 will be worth a few million euros, while, were the programme to go on until then, they will be worth roughly €1.5 billion per month in March 2019, which is sizeable because it would increase the monthly purchases of German bonds by approximately 10 percent. This effectively means that, while the limits will be reached at roughly the same time as before the rules changed, the balance sheet of the Eurosystem will be bigger at that time thanks to the increase in eligible debt.
Figure 4 shows our projections for the second scenario, in which only central government debt securities issued after 1 January 2013 are assumed to contain CACs. The limits will be reached later than in scenario 1, as can be seen easily by comparing figures 2 and 3. For example, while in scenario 1, purchases in Germany are heavily constrained after April 2017, this is not the case until March 2018 in scenario 2.
On 21 January 2016, President Draghi hinted at further easing, given “downside risks” related to heightened uncertainty about the growth prospects of emerging economies, volatility in financial and commodity markets, and geopolitical risks. While this further easing could come in the form of a further reduction in the deposit rate, which would increase the amount of debt eligible for purchase (provided that the yields on these securities do not fall excessively in the meantime), the Governing Council might also decide to increase the amounts purchased each month under the PSPP. The Eurosystem is currently purchasing €44 billion of agency and government debt per month, but this could be raised. In Figures 5 and 6 we show our projections of monthly purchases were the amounts purchased each month to increase from €44 billion to €64 billion in March 2016, in both scenarios. As is apparent, the limits in each country would be reached much more quickly. Under the more restrictive scenario 1, the limit in Germany, the country in which purchases are the highest, would be reached as soon as November 2016. An increase in monthly purchases might be desirable to provide immediately a more accommodative stance to the euro area’s monetary policy in order to reach the inflation target, but it might not be compatible with a longer duration of the programme if the rest of the programme design remains unchanged.
Figure 2: Projection of monthly purchases (€ billion) per country with original rules (excluding national agencies) from Claeys et al (2015b)
Sources: Bruegel based on ECB, NCBS, National Treasuries, Datastream. Note: Luxembourg, Lithuania and Estonia do not appear on this chart given the very small amount of debt securities of these countries in the market.
Figure 3: Projection of monthly purchases (€ billion) per country, including national agencies (scenario 1: all debt securities contain CACs)
Source: Bruegel based on ECB, NCBs, National Treasuries, Thomson Reuters.
Figure 4: Projection of monthly purchases (€ billion) per country, including national agencies (scenario 2: only central government debt issued after the 1st of January 2013 contains CACs)
Source: Bruegel based on ECB, NCBs, National Treasuries, Thomson Reuters.
2.4 What could be done to further extend the duration of the programme if necessary?
Claeys et al (2015b) already recommended that the ECB increase the 25 percent issue limit to address the constraint that it would place on the size and duration of the PSPP. Claeys et al (2015b) also recommended that the list of eligible agencies be broadened. These changes have been put in place since March 2015, but that might not be enough to increase the pool of eligible assets. That is why Claeys et al (2015b) also recommended waiving entirely the issue limit, at least for AAA-rated bonds. This would allow, for instance, longer purchases of German sovereign bonds or European Investment Bank bonds.
The composition of the purchases could also be further altered. As already discussed at length in Claeys et al (2014), there are other types of assets that the Eurosystem could purchase if the ECB QE programme needs to be enhanced to bring inflation back to target. This could lengthen the duration of asset purchases, and increase the monthly monetary stimulus.
The Eurosystem could purchase senior well-rated uncovered bank bonds. While they are riskier than the covered bank bonds which are already being purchased under the CBPP3, the comprehensive assessment carried out by the ECB and national supervisors in 2014 and 2015 should theoretically ensure that euro-area banks are adequately capitalised and can smoothly absorb financial shocks. According to the ECB, there is currently more than €2 trillion of uncovered bank bonds which are eligible as ECB collateral10 (the Eurosystem collateral eligibility framework is not exactly similar but is roughly comparable to the eligibility criteria of assets for purchase, except for instance in terms of accepted maturity and minimum yield).
Another possibility would be for the Eurosystem to purchase corporate bonds, of which there are almost €1.5 trillion eligible for collateral purposes (although part of these are not euro-denominated, or are issued by corporates outside the euro area, in which case they should not be eligible).
Purchases of these securities might have different, or even complementary, effects, as explained in Claeys et al (2014). However, they could help the Eurosystem provide a stronger monetary accommodation for a longer period, and delay worries that the QE programme would reach its limits before the path of inflation is consistent with the inflation target.
Finally, the ECB Governing Council could also decide to change the way purchases are spread across euro-area countries, in order to shift some of the purchases from countries in which the limit will be binding (eg in Germany by the Bundesbank) to other national central banks. The first major country in which the limits will be reached is Germany, because the amounts purchased in each country are proportional to european central bank ecb retirement plan country’s capital subscription to the Eurosystem, of which Germany is the largest, while there is proportionally much less outstanding debt in Germany than in Italy, for example. Distributing the purchases across countries according to their outstanding debt instead of distributing them according to the ECB capital keys would lead to limits being reached in every country at roughly the same time11. Given the various channels through which asset purchases can influence monetary conditions and thereby economic activity and prices, changing the country distribution of purchases could alter the effects of QE in the euro area12, which should be carefully taken into consideration by the Governing Council, were it to take this decision.
Figure 5: Projection of monthly purchases (€ billion) per country, including national agencies, if amount purchased is increased to €64 billion (scenario 1: all debt securities contain CACs)
Source: Bruegel based on ECB, NCBs, National Treasuries, Thomson Reuters. Note: see note to Figure 3.
Figure 6: Projection of monthly purchases (€ billion) per country, including national agencies, if amount purchased is increased to €64 billion (scenario 2: only central government debt issued after 1 January 2013 contains CACs)
Source: Bruegel based on ECB, NCBs, National Treasuries, Thomson Reuters. Note: see note to Figure 3.
3. Potential risks related to unconventional monetary policy
The unconventional and previously untested nature of these policies poses some legitimate questions regarding their potential adverse consequences for financial stability, inequality and in terms of the credibility of the ECB.
3.1 Risks for financial stability
The ECB’s asset purchase programme, combined with the other unconventional monetary measures implemented since 2008 to avoid a full-scale liquidity crisis in the banking sector and the break-up of the euro area, contributes to an accommodative monetary policy stance. Cuts to the central bank rates to close to or even below zero, large-scale asset purchases, long-maturity lending to banks and forward guidance lead to loose monetary conditions that should stimulate growth and bring inflation back towards the 2 percent target. By increasing inflation and output (and therefore public debt sustainability), these measures should benefit financial stability. However, prolonged accommodative monetary policies could also pose some challenges to financial institutions and might have adverse consequences through various channels for financial stability.
One of the purposes of monetary policy is to support the economy by encouraging more risk-taking at a time when risk-taking in the financial system is less than socially desirable. However, if risk-taking becomes excessive and goes beyond what is socially desirable, it might contribute to future financial instability. It is very difficult to say when risk-taking becomes excessive, but as discussed in Claeys and Darvas (2015), banking indicators do not suggest substantially-increased risk-taking over the last six years and show on the contrary a clear tightening of credit standards in the euro area, while bank leverage has declined significantly, which should reduce the risks to financial stability. Bank regulation, stricter supervision and market pressure might have played an important role in limiting financial-sector leverage.
Increases in asset prices disconnected from fundamentals are also often mentioned as a potential side effect of QE programmes. However, while it is true that foreclosed homes for sale tulsa indices have been trending higher throughout the world over the last few years, simple equity valuation indicators do not suggest any obvious bubbles. The same appears to be true for housing prices in the euro area14.
QE programmes are also accused of threatening financial stability by reducing the profitability of financial institutions. For instance, some life insurance companies in the euro area have liabilities with longer maturities than their assets and are thereby exposed to a decline in foreclosed homes for sale tulsa rates given the guaranteed returns they promise to clients15. But it also appears that non-life insurance activities are expected to perform well in the coming years, which might compensate for the declining profitability of life insurance, which is often provided by the same companies. Moreover, as argued by President Draghi in January 201616, even if the ECB monitors the impact of its low rate policy on financial stability, the ECB’s mandate is not per se to ensure the profitability of any particular financial institution, especially if the decline in profitability of this institution arises from an european central bank ecb retirement plan business model based on a peculiar maturity mismatch17.
Should monetary policy target financial stability explicitly? The global financial crisis has demonstrated that price stability in itself is not sufficient to ensure financial stability. Bubbles and boom-bust credit cycles emerged and eventually led to very high costs in terms of reduced output and unemployment in several advanced countries. A broad consensus has emerged that financial stability issues should be addressed ex ante. However, there is no consensus on the role of monetary policy in supporting financial stability. In our view, monetary policy tools are not well suited to tame financial excesses when the financial cycle deviates from the economic cycle or when financial cycles in euro-area countries differ. Monetary policy should focus on its primary mandate of area-wide price stability. Micro-prudential supervision, macro-prudential supervision, fiscal policy and regulation are the keys to mitigating financial stability risks. It is still too early to judge the effectiveness of the new European frameworks for micro- and macro-prudential supervision. The literature assessing these tools in other jurisdictions has produced some encouraging results, but the complex European set-up could make their implementation less effective.
Overall, as assessed by Claeys and Darvas (2015), the benefits of unconventional monetary policy measures including large-scale asset purchases seem to outweigh their potential risks to financial stability. The ECB should nevertheless be vigilant and be aware of the potential financial stability consequences of its monetary policy actions. Prudential policies, to which the ECB will now contribute via the Single Supervisory Mechanism and the European Systemic Risk Board, should be implemented forcefully in order to create a first line of defence in addressing financial stability concerns and avoiding the build-up of financial imbalances in the euro area.
3.2 Distributional effects of QE
The increase in income and wealth inequality observed in many advanced countries in recent decades is a long-term trend and primarily the result of deep structural european central bank ecb retirement plan, including skill-biased technological change, globalisation, demographics, institutional and political changes and, in particular, changes to fiscal, educational and labour institutions. Nevertheless, there are some concerns that QE programmes could amplify this trend, at least in the short and medium terms.
Through increases in financial asset prices, central bank asset purchases could increase inequality between the wealthy and poor, between the young and old, and also between regions when they have different financial structures. Increases in the value of assets such as equities and government and corporate bonds will tend to favour the rich who have greater holding of them, as illustrated in Claeys et al (2015a) using the ECB’s Household Finance and Consumption Survey (2013). Because older people tend to have higher savings and might sell them in the future in order to maintain their consumption, while younger households will usually buy cardless atm near me apple pay assets in the future in order to save for retirement, QE programmes might have distributional consequences across generations. QE can also benefit households differently depending on the structure of their financial assets, since certain households could make better use of the opportunity offered by low-interest rate borrowing than others.
However, QE merrimack county savings bank jobs could also reduce inequality through an increase in (or at least a stabilising effect on) housing prices and a fall in interest rates. Housing is the main asset of the middle class19 and therefore house price increases will tend to compress the wealth distribution. Falls in mortgage interest rates also tend to benefit people with lower incomes who spend a greater share of their income on servicing their debts.
Likewise, the stimulative effects that unconventional monetary policy has on the economy tends to reduce inequality. The empirical literature suggests that asset purchase programmes tend to boost inflation, output and employment. In the absence of these policies, unemployment would thus be higher, which would lead to higher income inequality because the poor and low-skilled are the most likely to lose their jobs in recessions and because wages are the primary source of revenue for poorer and lower-income people.
The ECB’s primary mandate is to maintain price stability, and considerations of inequality are not within its purview, unless inequality prevents the transmission of monetary policy in some way. The ECB should therefore focus on its price stability mandate by supporting the fragile recovery now taking place in the euro area. This is the best way for monetary policy to contribute to the avoidance of an increase in inequality.
Another important policy question is how to tackle inequality in general, and whether governments should design special measures in a deep recession or in a situation in which central bank actions increase inequality. For example, in the United States, policies such as the Home Affordable Refinance Programme, which helped homeowners with negative home equity to refinance their mortgages, might have helped dampen the rising inequality that resulted from the housing slump. Fiscal and social policies are the right tools to fight inequality. As documented by Darvas and Wolff (2014), there are huge differences in the efficiency of social redistribution systems in EU countries. For their levels of social expenditure and personal income taxes, several southern European countries and Belgium achieve a much smaller reduction in inequality than other EU countries. Revising national tax/benefit systems for improved efficiency, intergenerational equity and fair burden-sharing between the wealthy and the poor is the right way to fight inequality.
3.3 Credibility risks for the ECB
The primary mandate of the ECB is to ensure price stability in the euro area, and merrimack county savings bank jobs ECB’s credibility is based on fulfilling this mandate. If inflation deviates significantly from “below but close to 2 percent” for food lion altavista va prolonged period of time, expectations might start to deviate as well, and companies and households might start making decisions concerning wages and prices with a different inflation anchor in mind, which could be very dangerous given the self-fulfilling nature of inflation expectations. Since the beginning of 2013, inflation has been trending well below its target and expectations have started drifting downwards as a result. The ECB has thus not been fulfilling its mandate and is therefore at risk of losing its credibility.
On the contrary, the fear that the ECB will lose its credibility because of the significant amount of sovereign bonds it is currently buying appears to be unfounded for several reasons. First, it is true that if inflation was running well above the 2 percent target and that the ECB was buying sovereign bonds with the sole objective of easing financing conditions on government debts despite the do you get amazon music with amazon prime that it could drive inflation further above the target, then the ECB could easily lose credibility and put itself in a very dangerous situation. However, the current situation is the opposite. Inflation is currently very low and the ECB needs to avoid at all costs that the inflation expectations of euro-area citizens and companies become disanchored. Without the option of easing monetary conditions further through rate cuts, the ECB had to resort to QE, like every other major central bank, in order to provide the necessary accommodation to fulfil its mandate.
Second, since the launch of the PSPP, the ECB Governing Council has been very careful to avoid breaching the prohibition of monetary financing included in the EU Treaty. The 25 percent issue limit for bonds containing CACs is there to prevent the ECB from having “a blocking minority in a debt restructuring involving collective action clauses” (ECB, 2015). This clearly indicates that the ECB does not want to be in a position in which it would have the power to block a potential vote on the restructuring of the ECB-held debt of a euro-area country, because not blocking such a restructuring could be interpreted as monetary financing of a member state. On the contrary, if a majority of creditors with collective action clauses would accept a restructuring of some bonds, the ECB could do nothing against such a restructuring and would have to accept it. Because it would not be voluntary, it would not be considered as monetary financing and would therefore not be in contradiction with the EU Treaty.
In our view, the problem is that the ECB has been so careful to avoid the possibility of monetary financing ex ante that it has put the operational implementation of its QE programme at risk by constraining it too much, as detailed in section 2. The ECB should instead try to balance both the risk of breaching the monetary financing prohibition and the risk of not fulfilling its mandate because of the limits imposed on its own QE programme. For instance, the risk of monetary financing of an AAA-rated government such as Germany’s appears to be currently negligible and should not act as a constraint on the full implementation of the programme and the achievement of the ECB’s mandate. We therefore renew our recommendation to the ECB to waive the 25 percent limit, at least for well-rated countries, in order to facilitate the implementation of its QE programme.
The sovereign quantitative easing programme of the ECB finally started in 2015. This decision was welcome given estadio bbva bancomer mexico clear downward trend in inflation and the feeble recovery of the euro area in the last few years.
Nevertheless, in a monetary union such as the euro area, with multiple sovereign debt securities, the execution of such a programme is very complex. The ECB Governing Council imposed limits to ensure ex ante that the ECB would not breach the prohibition of monetary financing. However, our updated calculations show that these limits will constrain the duration and size of the programme throughout 2017, even when taking into account the changes announced throughout 2015, and especially if the ECB decides to increase its monthly purchases. We recommend that the ECB further alter the programme guidelines. Changes could include the purchase of corporate bonds as well as senior well-rated european central bank ecb retirement plan bank bonds. A more radical change would be to move away from an allocation of asset purchases between countries based on the ECB capital keys, to an allocation based on the actual size of countries’ outstanding debts.
Additionally, the extension of the QE programme raises some legitimate questions on its potential adverse consequences. In our assessment, the benefits outweigh the potential negative implications, for instance for financial stability or for inequality. Central banks should of course be aware of the potential side effects of their actions (which are generally temporary), but issues of financial stability and inequality are mainly the result of deep structural changes, and therefore other policies remain essential to deal with them. Micro and macro-prudential policies should constitute the first line of defence to avoid the build-up of financial imbalances, while fiscal and social policies are the right tools to fight the current rise in inequality in advanced countries.
Baumeister, C. and L. Benati (2010) ‘Unconventional monetary policy and the great recession Estimating the impact of a compression in the yield spread at the zero lower bound’, Working Paper Series No 1258, European Central Bank
Claeys G., Z. Darvas, S. Merler and G. Wolff (2014) ‘Addressing Weak Inflation: the ECB’s Shopping List’, Policy Contribution 2014/05, Bruegel
Claeys G. and Z. Darvas (2015) ‘The Financial Stability Risks capital one credit card support line Ultra-loose Monetary Policy’, Policy Contribution 2015/03, Bruegel
Claeys G., Z. Darvas, A. Leandro and T. Walsh (2015a) ‘The Effects of Ultra-loose Monetary Policy on Inequality’, Policy Contribution 2015/09, Bruegel
Claeys G., A. Leandro and A. Mandra (2015b) ‘European Central Bank Quantitative Easing: the Detailed Manual’, Policy Contribution 2015/02, Bruegel
Darvas Z. (2016) ‘Oil prices and inflation expectations’, Bruegel Blog, 21 January
Darvas Z. and P. Hüttl (2016) ‘Has ECB QE lifted inflation?’ Bruegel Blog, 12 January
Darvas Z. and G. B. Wolff (2014) ‘Europe’s social problem and its implications for economic growth’, Policy Brief 2014/03, Bruegel
Diamond D. and P. Dybvig (1983) ‘Bank runs, deposit insurance, and liquidity’, The Journal of Political Economy, 91(3)
Draghi, M. (2015a) ‘Introductory statement to the press conference (with Q&A) Frankfurt am Main, 22 January’, available at http://www.ecb.europa.eu/press/pressconf/2015/html/is150122.en.html
Draghi, M. (2015b) ‘Introductory statement to the press conference (with Q&A) Frankfurt am Main, 3 September’, available at http://www.ecb.europa.eu/press/pressconf/2015/html/is150903.en.html
Draghi, M. (2015c) ‘Introductory statement to the press conference (with Q&A) Frankfurt am Main, 3 December’, available at http://www.ecb.europa.eu/press/pressconf/ 2015/html/is151203.en.html
Draghi, M. (2016) ‘Introductory statement to the press conference (with Q&A) Frankfurt am Main, 21 January’, available at http://www.ecb.europa.eu/press/pressconf/2016/html/is160121.en.html
ECB (2013) Household Finance and Consumption Survey, available at https://www.ecb. europa.eu/home/html/researcher_hfcn.en.html
ECB (2015) Implementation aspects of the public sector purchase programme (PSPP), 5 March, available at http://www.ecb.europa.eu/mopo/liq/html/pspp.en.html
Kapetanios, G., H. Mumtaz, I. Stevens and K. Theodoridis (2012) ‘Assessing the Economy‐wide Effects of Quantitative Easing’, The Economic Journal, 122(564): 316-347
european central bankMonetary policyQuantitative EasingИсточник: https://www.bruegel.org/2016/02/the-european-central-banks-quantitative-easing-programme-limits-and-risks/
Crunch talks begin as plan to end debt crisis stalls
CRUNCH emergency talks got under way in Frankfurt last night after French President Nicolas Sarkozy said a plan to end the debt crisis had stalled.
mid signs of growing tension in the negotiations, the French president announced his sudden huntington bank phone number customer service to attend the talks after a brief visit to the Paris maternity clinic where his wife Carla Bruni was due to give birth to their first baby.
German Chancellor Angela Merkel, European Central Bank (ECB) President Jean-Claude Trichet and International Monetary Fund managing director Christine Lagarde were forced to break away from a retirement party for Mr Trichet to attend the crunch negotiations ahead of a summit of European leaders this Sunday.
The leaders' summit has already been delayed by a week to give France and Germany time to hammer out a common plan to end the debt crisis that now threatens to send the world economy into a slowdown.
Incoming ECB President Mario Draghi, European Union President Herman van Rompuy and European Commission President Jose Manuel Barroso also flew in for the talks.
European equities closed flat yesterday, before news of the emergency session emerged. In the European central bank ecb retirement plan, stocks fell in late trading as talks got under way.
In the bond markets, traders said nerves were frayed. Borrowing costs for almost all euro countries increased yesterday, held in check only by fears of being caught on the wrong side of a rally next week if a deal is done on Sunday.
Irish government bond yields remain above 8pc and the premium the French government has to pay to borrow compared to Germany is close to a 19-year high.
Mr Sarkozy told a group of parliamentarians earlier that the talks had become bogged down over the issue of whether the European Central Bank should support the €440bn European Financial Stability Facility (EFSF), the eurozone rescue fund set up to prevent contagion from the sovereign debt crisis.
France has argued that the most effective way of leveraging the EFSF is to turn it into a bank which could then access funding from the ECB, but both the central bank and the German government opposed this.
"In Germany, the coalition is divided on this issue. It is not just Angela Merkel who we need to convince," Mr Sarkozy told the parliamentarians at a lunch meeting, according to Charles de Courson, one of the legislators present.
His comments fuelled doubts about whether eurozone leaders would be able to agree a clear and convincing plan when they meet on Sunday. Failure to do so would further undermine the financial markets' already shattered confidence in the currency bloc and its ability to get on top of a two-year-long debt crisis, which threatens the long-term viability of the single currency.
Reports suggested last night that any bank recapitalisation plan will be below €100bn.
One senior EU official, who is involved in coming up with solutions to the crisis, said the only "circuit-breaker" now was for the ECB to make an explicit commitment to go on buying distressed eurozone debt for "as long as it takes", something Mr Trichet has said should not happen.
That position appeared to be seconded by Mr Barroso, who said in Frankfurt: "The decisive intervention of the ECB in secondary bond markets was and still is a critical element in securing financial stability in the euro area."
Uncertainty over the eurozone's future intensified as Moody's issued a double-notch downgrade of Spain's credit rating a day after the agency warned France that its triple-A rating could come under pressure.
In Greece, workers began their biggest strike in years in protest at austerity measures.
Mrs Merkel warned late on Tuesday that leaders would not solve the debt crisis at a single meeting and reiterated that past errors would not be solved in "one stroke".
"If the euro fails, Europe fails but we will not allow that," she said in Frankfurt last night.
The hope remains that Sunday's summit will agree new steps to reduce Greece's debt, strengthen the capital of banks with exposure to troubled eurozone sovereigns and leverage the eurozone's rescue fund to prevent contagion.
"You know the French position and we are sticking to it. We think that clearly the best solution is that the fund has a banking licence with the central bank, but everyone knows about the reticence of the central bank," French Finance Minister Francois Baroin said.
A senior German government source said Berlin remained resolutely opposed to the ECB backstopping the rescue fund.
Eurozone officials say an alternative model, whereby the EFSF could underwrite a portion of newly issued eurozone debt, is also on the table.
The leader of the European Central Bank (ECB) has become very familiar with the challenge of ‘threading the needle’ in recent years and the test facing Christine Lagarde today was no different. After last month’s major announcements regarding the expansion of its QE program, the ECB announced few new meaningful measures today. It left its key interest rates unchanged and made no enhancements to its asset purchases. It did however decide to make borrowing conditions more favourable for euro area banks under its Targeted Longer Term Operations III (TLTROs) facility.
With an increasingly restricted toolkit to provide further stimulus, the ECB’s messaging had to be reassuring enough to avoid triggering market volatility and at the same time diplomatic enough to appease divergent views from across the euro area on the appropriate policy path. This task was only made harder by the downgrade of Italy’s sovereign bond rating by Fitch to one level above junk status and the large contraction in eurozone GDP for the first quarter of this year (-3.8% quarter on quarter).
Few new policy changes
With its deposit rate already at -50 basis points, the ECB’s decision to not reduce interest rates so far this year suggests a strong reluctance to go even lower. However, the ECB is not alone in seeing limited value in pushing rates further into negative territory. The Federal Reserve in its own meeting yesterday dismissed the idea that it would consider negative interest rates. The ECB is instead focusing on other tools as its main policy levers.
Borrowing costs for the TLTRO III programme were lowered to -1%, a further 25 basis points lower from last month’s meeting. The recent ECB bank lending survey showed a material increase in demand for loans across the euro area as corporates search for funds to get them though this period. In the near term, another series of short-term refinancing operations were also made available, likely as a safety net over the coming months. These are helpful measures but the magnitude of bond purchases is likely to be more important in supporting government spending to help mitigate the impact on the economy.
What are the other options?
With markets focused on debt sustainability, particularly in countries such citizens bank and trust of jackson Italy, the ECB will need to focus on expanding its asset purchase programmes. It could do so by ramping up purchase amounts under the Pandemic Emergency Purchase Programme (PEPP). In the press conference Lagarde suggested that PEPP is the preferred tool as opposed to Outright Monetary Transactions (OMT), previously used in the sovereign debt crisis, given this is a euro area wide issue. An extension of PEPP beyond the end of this year, dependent on the duration of the virus was also highlighted as an option.
Having already announced that it would accept recently downgraded high yield bonds – so called ‘fallen angels’ – as collateral for banks’ loans and made Greek bonds eligible for the PEPP, the ECB could also widen the scope of the asset purchases to include high yield bonds. Lagarde stopped short of explicitly confirming the forthcoming implementation of these measures, but stated that the flexibility of the ECB’s mandate can be increased if required.
Ultimately, it is clear that the ECB will need to increase stimulus measures this year to ensure that the wave of bond supply required to fund government stimulus packages is smoothly digested by the market. At this meeting, Lagarde preferred to take a “wait and see approach” in the hope that coordinated government action will shoulder some of the burden and lift some of the pressure on the central bank to save the day.
Trying to find the perfect balance of policy announcement and forward guidance was always a tough challenge and markets appear to have reacted negatively to the measures announced today. The euro has fallen around 0.3% versus the dollar and European equities are also down on the day. The spread of Italian 10-year yields over Germany has been volatile and has broadly risen. With expectations from the ECB that eurozone GDP could fall by 5% - 12% in 2020, calls for further central bank action look set to get louder over the coming months.
Draghi attempts to heal divided ECB in farewell speech
Departing ECB president Mario Draghi tried to restore unity among eurozone central bankers in his farewell america first credit union fax number on Monday (28 October) but he continued to defend his recent controversial monetary decisions.
Draghi passed the European Central Bank presidency baton to former IMF managing director Christine Lagarde in a critical moment, rounding off his farewell tour.
Deteriorating global confidence mixed with trade and geopolitical tensions forced the ECB to restart its bond buying programme in September, and to cut deposit rates further into negative territory.
Draghi urges Germany, Netherlands to invest against risk of recession
The European Central Bank said on Thursday (12 September) it will reactivate its bond-buying programme, stepping up the monetary stimulus to maintain economic growth, but its president Mario Draghi told Germany and the Netherlands the time has come to spend more in order to avoid the risk of a downturn.
The effectiveness of the decisions were questioned by members of the ECB’s governing Council, including France, Germany, European central bank ecb retirement plan and the Netherlands.
But as his mandate expires on 31 October, he highlighted the shared “never accept failure” goal among the ECB’s governing council members, as well as the inflation target of below-but-close to 2%.
Draghi praised their “consistent and unconditional commitment to our mandate” of price stability.
EU grandees send Draghi to ‘euro pantheon’
European Central Bank President Mario Draghi chairs his last governing council on 24 October, before Christine Lagarde takes over on 1 November. EURACTIV contacted eight politicians, decision-makers and analysts from different countries to review Draghi’s eight-year mandate at the ECB.
“You can look back with satisfaction on what you achieved in extremely testing conditions, and in the knowledge that you have improved the welfare of many people,” he told the audience, including French President Emmanuel Macron, Italian counterpart Sergio Mattarella, German Chancellor Angela Merkel and Lagarde.
“What unites the Governing Council has always been – and will always be – much greater than anything that might divide it. We all share the same devotion to our mandate and the same passion for Europe,” he added.
Draghi calls for euro budget in farewell to MEPs
ECB President Mario Draghi urged EU co-legislators on Monday (23 September) to set up a fiscal capacity to counter eurozone’s economic shocks, as he warned of the worsening economic outlook in his farewell debate with MEPs.
During his speech, Draghi called once again for a eurozone budget to equip the region with the right tools against sudden economic shocks.
The Italian banker made a similar plea in his final words to the European Parliament in September and after his last Governing Council on 24 October.
Draghi's farewell demand: the eurozone budget
Outgoing European Central Bank President Mario Draghi stressed in his farewell press conference on Thursday (24 October) that a truly eurozone budget “with an adequate size” would be the number one issue to fix in the eurozone.
Draghi elaborated on the reasons why a common fiscal cushion for the euro area is necessary.
“National policies cannot always guarantee the right fiscal stance for the euro area as a whole,” given the complexity of coordinating decentralised fiscal policies, and the low impact of the national fiscal stimulus on neighbouring economies
For that reason, he called for an “euro area fiscal capacity of adequate size and design: large enough to stabilise the monetary union, but designed not to create excessive moral hazard.”
Draghi warned that setting up this eurozone budget could take a long time, and “there will be no perfect solution”.
In order to overcome the existing barriers, he said that Europe might need “an urgent cause”, such as the fight against climate change, to bring the necessary “collective focus” to create the eurozone budget.
Eurozone sharpens up new anti-shock fund
Finance ministers of the 19-member euro area reached agreement late on Wednesday (9 October) on the details of a “budgetary instrument” for the eurozone, including stronger measures to support countries hit by a sudden economic shock.
In his remarks, Draghi did not make a reference to the budgetary instrument for convergence and competitiveness, the watered-down version of the eurozone budget that member states are finalising.
Draghi claimed that, in a monetary union with 19 countries, political leaders must transcend “national perspectives” and explain the euro area perspective to their domestic audience.
“I am grateful that we have had such leaders in Europe,” he said about Macron, Merkel and Mattarella, as he thanked them for their support throughout the crisis years.
Merkel said Draghi paid an “outstanding” service to Europe and would leave “large steps” behind him.
She thanked Draghi for ensuring price stability in recent years, and said how the ECB’s independence was a “protection” when policymakers disagreed with what he did.
Macron praised his knowledge, courage, humility and, above all, his humanism.
“You were always aware what was more important than words and figures,” Macron said, adding that he always had the public interest as his “compass”.
For that reason, Draghi won his place among the EU’s founding fathers, Macron added.
Lagarde pledges to continue with Draghi’s loose monetary stance
Christine Lagarde promised on Wednesday (4 September) to respond with “agility” to the looming financial and economic turbulences once she becomes the president of the European Central Bank in November, while confirming that the current loose monetary stance will continue for a “long period of time.”
Lagarde, who on Monday joined the governing council’s meetings, highlighted his wisdom, determination and his “commitment to the people of Europe”.
“You showed you cared for people,” she said.
[Edited by Sam Morgan]
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European Central Bank (ECB)
What is European Central Bank (ECB)?
The European Central Bank (ECB) is the central bank responsible for monetary policy of those European Union (EU) member countries which have adopted the euro currency. This region is known as the eurozone and currently comprises 19 members. The principal goal of the ECB is to maintain price stability in the euro area, thus helping preserve the purchasing power of the euro.
- The European Central Bank (ECB) is the central bank of the combined Eurozone.
- The ECB coordinates EU monetary policy, including setting the region's target interest rates and controlling the supply of the Euro common currency.
- The ECB's primary mandate is to achieve price stability through low inflation.
Understanding European Central Bank (ECB)
The European Central Bank (ECB) is headquartered in Frankfurt am Main, Germany. It has been responsible for monetary policy in the Euro area since January 1, 1999, when the euro currency was first adopted by some EU members. The ECB Governing Council is the body within the ECB that actually takes decisions on eurozone monetary policy.
The Council consists of six executive board members and the governor (or equivalent) of each member's national central bank. As membership of the Euro area has expanded, so has the number of governors in the Governing Council. ECB has a system of rotating voting rights among the national bank governors (the executive board members have permanent voting rights), as the Governing Council is now too large for all members to vote at each meeting.
The European Central Bank was established in 1999. The governing council of the ECB is the group that decides on changes to monetary policy. The council consists of the six members of the executive board of the ECB, plus the governors of all the national central banks from the 19 euro area countries. As a central bank, the ECB does not like surprises. Therefore, whenever it plans on making a change to interest rates, it will generally give the market ample notice of an impending move through comments to the press. The governing council meets twice a month, but policy decisions are generally only made at meetings where there is an accompanying press conference, and those are held every best mortgage refinance rates in texas weeks.
The ECB's mandate is for price stability and sustainable growth. However, unlike the Federal Reserve in the U.S., the ECB strives to maintain the annual inflation level (growth in consumer prices) below 2%. As an export-dependent economy, the ECB also has a vested interest in preventing against excess strength in its currency because this poses a risk to its export market.
European Central Bank (ECB) Functions
The primary responsibility of the ECB, linked to its main goal of price stability, is formulating monetary policy. This involves making decisions about monetary objectives, key interest rates, the supply of reserves in the Euro-system and establishing guidelines for implementing those decisions. Monetary policy decision meetings are held every six weeks, and the ECB is transparent about the reasoning behind its decisions. It holds a press conference after each such meeting, and later publishes the minutes of the meeting.
The European central bank ecb retirement plan comprises the ECB and the national member states' central banks. The Euro-system is responsible for the practical implementation of ECB policy (such as implementing policy, actually holding and managing foreign reserves, operating in the foreign exchange market, and ensuring the payments system runs smoothly.)
The ECB is also the EU body responsible for banking supervision. In conjunction with national central bank supervisors, it operates what is called the Single Supervisory Mechanism (SSM). The decisions involved in this function are mainly aimed at ensuring the safety and soundness of the European banking system. Part of the rationale for the SSM is to ensure consistent banking supervision practices across member country banking systems—lax supervision in some member countries had been part of the cause of the European financial crisis that started in 2008. The SSM began functioning in November 2014. All euro area countries are in the SSM and non-euro EU countries can choose to join.
Remuneration & benefits
This page refers to remuneration and benefits applicable to EIF employees only.
For information regarding remuneration of members of the Governing Bodies, click here
The EIF offers a competitive employment and remuneration package composed of base salary, variable remuneration, benefits as well as health and pension schemes. Compensation and benefits are explained fully during the recruitment process and benefits are detailed in the Staff Regulations, which form an integral part of the employment contract.
EIF salaries are designed to be competitive, to take into account the differing levels of responsibility and to motivate and encourage performance.
There are 9 Grade levels at the EIF. The corresponding salary bands are available below (minimum and maximum for each band).
Salary Bands (in gross terms):
Salary increase and promotion to higher responsibilities are based on performance and professional development. Evaluation of merit is expressed in a performance profile following an annual performance evaluation exercise conducted by management for all staff members.
The EIF may, under certain conditions, distribute an annual performance award. The EIF performance award envelope is impacted by the EIF’s achievements of its annual objectives, as approved by the Board, and is distributed to staff according to individual performance. The net annual performance award granted to a staff member cannot exceed 35% of his/her annual basic salary.
The Protocol of Privileges and Immunities of the European Union applies to our staff.
You are liable to pay income tax to the European Union on your EIF salary and pensions. We withhold this tax at source. You are exempt from paying national taxes on your EIF income.
The tax scale is progressive: the greater the taxable income, the higher the rate of tax. The scale is divided into income brackets with increasing percentages of taxation, from 0% to 45%. The original tax scale was laid down in 1968 by EC Regulation No 260/68 on tax, with a coefficient of 100%. This coefficient is readjusted on a regular basis by the Council of Ministers of the European Union and published in the Official Journal.
Other benefits (financial and non-financial)
The EIF offers a comprehensive range of benefits and advantages, subject to eligibility, including:
- Installation allowance and relocation assistance
- Expatriation allowance
- Family allowance
- Child Assistance Allowance
- A defined benefit Pension Scheme (with the possibility to subscribe to an Optional Supplementary Provident Scheme)
- A comprehensive Health Insurance Scheme
- Accident and Life Insurance
- Subsidised housing loans
- Training and Development Programme
- Career development opportunities
- Annual leave (24 days per calendar year, 17 EIB Group bank holidays, special leave for family events)
- Flexible working arrangements (teleworking, part-time)
Benefits upon departure:
- Resettlement allowance and relocation assistance
- Termination allowance paid at the expiry of a fixed-term contract