A key objective of the Bank of Finland’s strategy as a central bank is to foster a sustainable economy and promote stability. The pursuit of this objective requires determined economic governance and systematic HR planning.

The Bank of Finland monitors its operating expenses and related objectives closely.

The intention is to achieve the Bank’s targets for efficiency and sustainability.

The Board evaluates implementation of the objectives on a quarterly basis.

Bank of Finland

In 2022, the Bank of Finland’s operating expenses totalled EUR 102.7 million (2021: EUR 96.3 million). Income totalled EUR 16.9 million and was derived from, for example, usage charges, rents and various fees.

The effects of the COVID-19 pandemic were still evident particularly in staff-related expenses, which fell due to there being very few business trips or stakeholder events. There will also be fewer business trips in the future compared with the pre-pandemic situation, as the number of remote and hybrid meetings in the international context has increased.

The impact of inflation was not evident to any significant extent in operating expenses and investment in 2022, largely because of contract prices that had been agreed earlier.

The extent of the net difference between operating expenses and income depends on the amount of rental income from real estate and income from investments other than those in the reserve fund.

The Bank of Finland also has other major sources of income, but these do not have the effect of decreasing operating expenses in the budget and are therefore not included in the table here.

The Bank’s net operating expenses totalled EUR 85.8 million. For a more detailed breakdown of the outturn for 2022 and the budget for 2023, see Table 1.

Table 1.
Bank of Finland Outturn2022EUR m Budgeted2023EUR m
Operating expenses and income
EXPENSES
Staff expenses -37.3 -40.1
Staff-related expenses -2.0 -3.9
Other expenses -30.0 -35.2
Banking service expenses -10.4 -8.6
Depreciation -8.6 -9.5
Total -88.3 -97.3
Banknote acquisition costs -6.1 -5.0
Pension fund contribution -8.3 -8.3
Total operating expenses -102.7 -110.6
INCOME
Banking service income 3.8 2.8
Real estate 5.3 5.2
Other income 1.1 0.3
Services to FIN-FSA 6.8 7.3
Total income 16.9 15.6
Net -85.8 -95.0
Due to rounding, the totals do not necessarily tally.

Investment expenditure (Table 2) totalled EUR 9.2 million. The biggest investments were in real estate and IT projects. Investments are evaluated based on their costs, qualitative benefits and operational risks, and attention is focused on the medium-term planning of investment.

In autumn 2022, the Bank’s budgets for the period 2023–2025 were drawn up. The Board ratified the budget for 2023.

Table 2.
Bank of Finland Outturn2022EUR m Budgeted2023EUR m
Investment
Real estate investment 5.0 6.0
Head office premises 1.3 1.5
Vantaa premises 3.1 4.2
Other premises 0.5 0.4
IT equipment and software 4.0 6.1
Cash handling machines 0.0 0.1
Security equipment 0.2 1.5
Other 0.0 0.1
Total investment 9.2 13.9
Due to rounding, the totals do not necessarily tally.

Pension fund

The pension fund’s operating expenses for 2022 totalled EUR 31.1 million (2021: EUR 30.8 million). Pensions paid constituted the largest cost item, amounting to EUR 29.2 million. Operating income (employment pension contributions and rental income) amounted to EUR 15.3 million during the year.

The pension fund also received a pension fund contribution of EUR 10.0 million from the Bank, which was used to cover some of the pension fund deficit for the accounting period.

For a more detailed breakdown of the outturn for 2022 and the budget for 2023, see Table 3.

The pension fund’s operations are presented in its own annual report.

Table 3.
Pension fund Outturn2022EUR m Budgeted2023EUR m
Operating expenses and income
EXPENSES
Staff expenses 0.0 0.0
Expenses for pension fund activities -0.3 -0.3
Pension fund real estate expenses -0.6 -0.6
Depreciation -1.0 -1.0
Pensions paid -29.2 -31.8
Total expenses -31.1 -33.6
INCOME
Employment pension contributions 13.6 14.5
Internal rents 1.7 1.8
Pension fund contribution 10.0 10.0
Total income 25.3 26.4
Net -5.8 -7.2
Due to rounding, the totals do not necessarily tally.

Financial Supervisory Authority

The Board of the Bank of Finland ratifies the budget for the Financial Supervisory Authority (FIN-FSA) each year.

The FIN-FSA’s operating expenses for 2022 totalled EUR 40.8 million (2021: EUR 39.7 million). Total income amounted to EUR 43.1 million, of which supervision and processing fees accounted for EUR 38.7 million, while the Bank of Finland’s contribution to funding was EUR 2.0 million.

The figure for income includes a surplus of EUR 2.4 million from the previous accounting period. The surplus for the financial year was EUR 2.3 million. The surplus will be taken into account in the following accounting period when the supervisory and processing fees are set. Investment expenditure totalled EUR 2.1 million.

For a more detailed breakdown of the outturn for 2022 and the budget for 2023, see Table 4.

The FIN-FSA’s operations are presented in its own annual report.

Table 4.
Financial Supervisory Authority Outturn2022EUR m Budgeted2023EUR m
Operating expenses and income
EXPENSES
Staff expenses -25.1 -27.9
Staff-related expenses -0.4 -1.2
Other expenses -5.7 -8.0
Depreciation -1.1 -1.0
Services from the Bank of Finland -6.8 -7.3
Pension fund contribution -1.7 -1.7
Total operating expenses -40.8 -47.1
FUNDING OF OPERATIONS
Supervision fees 36.7 41.0
Processing fees 2.1 1.8
Bank of Finland contribution to funding 2.0 2.4
Surplus/deficit transferred from previous year 2.4 1.9
Total income 43.1 47.1
Surplus transferred to next year -2.3
Due to rounding, the totals do not necessarily tally.
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