Question discussed at the 2007 general meeting

Article 20 (4) of the Organic Law stipulates that it is the Council of Regency that has the final say in determining the distribution of profits. In fixing the amount of the second dividend, the Council of Regency follows a policy whose main objective is to allocate a total dividend which is stable in terms of purchasing power.

In following this dividend policy, the National Bank is aiming to strike a balance between its public interest tasks and the right remuneration rate on its capital, regardless of any fluctuations in returns on assets and costs on the liabilities side and therefore fluctuations in the profits or, the case may be, in the losses. The shareholder thus receives a stable dividend that does not depend on the Bank’s financial results, which are mainly attributable to Eurosystem monetary policy and to external factors, such as demand for banknotes or exchange rate movements.

This is why the drop in profits earned during the 2006 financial year compared with the previous year has no impact on the dividend, which increases in line with the rise in the cost of living.