Hidden income of the ECB: why Lagarde's actual reward exceeds official figures by 56%

The investigation by the British Financial Times revealed a significant discrepancy between the disclosed and actual salary of the European Central Bank’s (ECB) chief. The analysis shows that Lagarde’s annual income reaches approximately €726,000, while the bank officially reports only a “base salary” of €466,000. This difference amounts to over 56% of the officially disclosed figure — a substantial deviation that raises questions about the transparency of the financial reporting of Europe’s main banking institution.

Structure of Hidden Payments

The gap between the official and actual salary arises from a system of additional payments not included in the base rate. In addition to the €466,000 basic salary, Lagarde receives about €135,000 as compensation for housing and other social needs. These amounts are systematically excluded from the ECB’s annual reports, remaining outside the public and analyst scrutiny.

An additional component of income is approximately €125,000, which the ECB president receives for his role as a member of the Board of Directors of the Bank for International Settlements (BIS). These payments also remain outside the official reporting of the European Central Bank, creating a sort of “window” into informational transparency.

Comparison with U.S. Leadership

The most shocking aspect of the investigation is the scale of the discrepancy compared to the American counterpart. Lagarde’s actual income nearly quadruples the compensation of the U.S. Federal Reserve Chair Powell — a figure that demonstrates a significant asymmetry in pay among the world’s leading central banks. This comparison questions the principles of fairness and justification of remuneration in international financial institutions.

Transparency Issues

The European Central Bank is not subject to the strict disclosure rules established for companies listed on EU stock exchanges. These standards typically require providing “full and accurate information about directors’ remuneration.” As an independent institution, the ECB has much greater flexibility in determining the structure and presentation of executive income data.

The methodology used by the Financial Times is based on ECB and BIS annual reports, as well as technical documents explaining the “terms and conditions of remuneration” for senior officials. However, the investigation does not account for pension contributions, medical insurance costs, and other benefits financed by the institution — meaning the actual expenses for maintaining leadership could be even higher.

Revealing this gap between the officially disclosed and actual salary raises new questions about the need to strengthen transparency requirements in international financial institutions.