As expected, the Deutsche Bundesbank further reduced its loss for the year in 2025. In view of a significant improvement in profitability, the loss for the year fell by more than one-half compared with 2024 to €8.6 billion. While we continue to bear financial burdens, these are easing, said Bundesbank President Joachim Nagel at the press conference presenting the annual accounts. He added: From today’s perspective, this positive development is likely to continue. 

Nevertheless, patience is still required, he noted, as the Bundesbank will report an annual loss again this year. The accumulated loss, resulting from the accumulated losses carried forward and the current loss for the year, amounts to €27.8 billion overall at present. But the Bundesbank’s financial burdens are temporary in nature, Mr Nagel said. We will use profits from future financial years to reduce the accumulated loss and build up adequate risk provisions, all without external assistance, he explained.

The Bundesbank remains able to fully discharge its tasks even if it reports an accumulated loss. There is one thing we should not lose sight of here: the Bundesbank still has a sound balance sheet, Mr Nagel said. The Bundesbank has large revaluation reserves, which rose to €388 billion at the end of 2025 and were thus many times greater than the current and prospective accumulated losses. 

Price stability achieved

The Bundesbank President emphasised a very important achievement in 2025: Price stability prevails in the euro area once again. This achievement is due in part to the decisive action taken by the ECB Governing Council, Mr Nagel said. The independence of central banks in the Eurosystem is the foundation for this action, Mr Nagel explained. However, he noted that surveys showed that many people felt poorer today than before the wave of inflation. For example, when shopping for groceries: food cost more than one-third more on average than in 2020. And that has quite an impact – it is food prices, in particular, that people pay attention to when gauging inflation, Mr Nagel noted.

In addition, many people were worried about new price surges. The ECB Governing Council is determined to stabilise inflation at 2 % on a lasting basis, the Bundesbank President assured. This is the key monetary policy task in 2026, he said. He noted that the Governing Council was currently well positioned in this regard, given the key interest rates, but remained vigilant. If the inflation picture changes substantially, we are well placed to respond. In this context, in the light of the military conflict in the Middle East, Mr Nagel pointed out that it was still too early to draw any monetary policy conclusions from this volatile situation.

With regard to the period of weakness in the German economy, Nagel advised not to forget Germany’s strengths: stable institutions with reliable rules, excellent research, adaptable enterprises and highly skilled and dedicated people. If policymakers loosen the brakes on growth, and society and the economy follow suit, this could create new momentum, Mr Nagel said. 

Annual burdens ease 

Financial burdens have continued to exert an impact in 2025. They were mainly caused by the monetary policy measures taken in recent years and the key interest rate hikes in 2022 and 2023. The loss for the year in 2025 more than halved compared to the previous year, but is still considerable at €8.6 billion, explained Bundesbank First Deputy Governor Sabine Mauderer. “We expect the burdens to carry on subsiding in 2026. Nevertheless, they will remain sizeable, announced Mauderer.

Net interest income improved by €8.9 billion on the year; however, at minus €4.2 billion, it remained in negative territory. The decline in bond holdings and lower key interest rates resulted in significantly lower burdens on net interest income.

Total assets changed only slightly in 2025. They fell by €24 billion to €2,349 billion. While monetary policy bond holdings declined by €122 billion, this decline was offset by the valuation of the gold position on the reporting date. This rose by €125 billion compared with the previous year-end figure owing to the sharp rise in gold prices and reached a new historical high of €395 billion. Net equity therefore rose by €112 billion to €363 billion.

First Deputy Governor Mauderer stressed that the Bundesbank was capable of shouldering both its current and foreseeable financial burdens: The Bundesbank is in sound financial shape and remains able to fully discharge its tasks even with an accumulated loss.