April 10, 2018 / 1:45 PM / a year ago

Decision needed on BoE's ECB stake after Brexit - Nowotny

FILE PHOTO: European Central Bank (ECB) Governing Council member Ewald Nowotny addresses a news conference in Vienna, Austria, March 30, 2017. REUTERS/Heinz-Peter Bader/File Photo

LONDON (Reuters) - Euro zone governments will have to decide whether they cover the small hole left in the European Central Bank’s finances if, as expected, the Bank of England returns its stake after Brexit, ECB policymaker Ewald Nowotny said on Tuesday.

The BoE is one of nine non-euro area central banks that contribute to the ECB’s operational costs. The UK central bank has ‘paid-up’ capital of roughly 55.5 million euros (£48.3 million), which is more than seven of the 19 euro zone countries.

“I guess this will be part of the general Brexit discussions,” Nowotny said about the BoE’s stake during an interview with Reuters.

“I would imagine they (the BoE) will end this participation and then there could be a discussion whether we keep the former capital of the ECB at the same level or whether it would be reduced.”

It was largely a “symbolic” issue, he added.

The ECB’s subscribed capital has edged up to just under 10.9 billion (£7.6 billion) since Estonia and Lithuania joined the currency bloc.

For Nowotny’s comments on ECB raising interest rates click

Reporting by Marc Jones and Helen Reid; editing by John Stonestreet

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