The European Central Bank (ECB) was founded in 1998 as the common monetary authority of the European Monetary Union and is based in Frankfurt am Main. The Italian Mario Draghi has been President of the ECB since November 1, 2011.
Since a few month Christine Lagarde is President of it.
The tasks of the ECB:
The main tasks of the ECB include regulating the money supply and monitoring the European banking system. Its aim is to prevent major fluctuations in the value of money and to keep the price level in the euro zone stable. Its most important control mechanism is the key rate, which determines the interest rate at which the national commercial banks can borrow money. The ECB is thus influencing the economic development in the euro zone and the inflation rate. Other important control instruments are the determination of the minimum reserve and the intervention on the foreign exchange market.
The organization of the ECB:
The board of directors is made up of six members, four of whom usually come from the large euro states Germany, France, Italy and Spain. The Executive Board, together with the Governors of the national central banks, forms the Governing Council, which takes the important decisions, such as setting the key interest rate. In the Maastricht Treaty, the political and financial independence of the ECB was agreed, which is to prevent conflicts of interest and the influence name from outside.