European Central Bank owed over €2bn by EBS (The Irish Times)
EBS building society has said it owes €2.2 billion under the European Central Bank (ECB) funding system but expects to reduce this over the remainder of the year.
The building society reported a 37 per cent drop in pretax profits to €27 million in the first six months of the year as the credit crisis raised funding costs substantially, costs that the society was slower to pass on to customers.
Total income fell 17 per cent to €83.8 million in the first half.
EBS chief financial officer Alan Merriman said the building society had raised €1 billion in term funding over the first six months. He added that there had been "a substantial reduction" in the society's net interest margin to 0.75 per cent from 0.9 per cent due to the higher cost of wholesale money.
Funding costs had risen from "historic lows" in the first half of last year to "historic highs" over the same period this year, he said.