9.2.2011 Official Journal of the European Union L 35/17 DECISION OF THE EUROPEAN CENTRAL BANK of 25 November 2010 on the allocation of monetary income of the national central banks of Member States whose currency is the euro (ECB/2010/23) (2011/66[EU) THE GOVERNING COUNCIL OF THE EUROPEAN CENTRAL BANK, Having regard to the Statute of the European System of Central Banks and of the European Central Bank (hereinafter the ‘Statute of the ESCB’), and in particular Article 32 thereof, Whereas: Decision ECB[2001/16 of 6 December 2001 on the allo- cation of monetary income of the national central banks of participating Member States from the financial year 2002 () has been substantially amended several times (2). Since further amendments are to be made, it should be recast in the interests of clarity. Pursuant to Article 32.1 of the Statute of the ESCB, monetary income is the income accruing to the NCBs in the performance of the monetary policy function. Pursuant to Article 32.2 of the Statute of the ESCB, the amount of each NCB’s monetary income is equal to its annual income derived from its assets held against notes in circulation and deposit liabilities to credit institutions. These assets are to be earmarked by NCBs in accordance with the guidelines of the Governing Council. NCBs should earmark the assets ensuing from the performance of the monetary policy function as assets held against the notes in circulation and deposit liabilities to credit institutions. Pursuant to Article 32.4 of the Statute of the ESCB, the amount of each NCB’s monetary income is reduced by an amount equivalent to any interest paid by that NCB on its deposit liabilities to credit institutions in accordance with Article 19. Pursuant to Article 32.5 of the Statute of the ESCB, the sum of the monetary income of the NCBs is allocated to them in proportion to their paid-up shares in the capital of the European Central Bank (ECB). (") OJ L 337, 20.12.2001, p. 55. (3) See Annex IV. (recast) ) Pursuant to Articles 32.6 and 32.7 of the Statute of the ESCB, the Governing Council is empowered to establish guidelines for the clearing and settlement by the ECB of the balances arising from the allocation of monetary income and to take all other measures necessary for the application of Article 32. Pursuant to Article 10 of Council Regulation (EC) No 974/98 of 3 May 1998 on the introduction of the euro (*), the ECB and the NCBs put euro banknotes into circulation. Article 15 of this Regulation provides that banknotes denominated in national currency units remain legal tender within their territorial limits until 6 months from the respective cash changeover date at the latest. The cash changeover year should thus be regarded as a special year, since banknotes in circulation denominated in national currency units may still account for a considerable proportion of the banknotes in circulation. Article 15(1) of Guideline ECB[2006/9 of 14 July 2006 on certain preparations for the euro cash changeover and on frontloading and sub-frontloading of euro banknotes and coins outside the euro area (*) provides that euro banknotes frontloaded to eligible counterparties are debited in those counterparties’ accounts with their NCB at their face value, in accordance with the following linear debiting model the total amount of frontloaded euro banknotes are debited in three equal instalments, on the settlement date of the first, fourth and fifth Eurosystem main refinancing operations following the cash changeover date. The calculation of monetary income for the cash changeover year needs to take account of this ‘linear debiting model’. This Decision is related to Decision ECB[2010/29 of 13 December 2010 on the issue of euro banknotes (%), which provides that the ECB and the NCBs issue euro banknotes. Decision ECB[2010/29 establishes the allo- cation of euro banknotes in circulation to the NCBs in proportion to their paid-up shares in the capital of the () OJ L 139, 11.5.1998, p. 1. () OJ L 207, 28.7.2006, p. 39. (>} See page 26 of this Official Journal. Decision ECB[2010/29 adopted before publication of Decision ECB/2010/23.