Central banking is broadly profitable in normal times , largely due to seignorage income the yield differential between notes and coins in circulation and the returns received from the fixed-income securities every central bank retains against these liabilities .
The second flaw or the euro as a monetary union , which has received less media attention , is the absence of an integrated banking system backed by a credible lender of last resort ( with the power of seignorage ) .
Central banks or their government shareholders enjoy a steady stream of profit from the issue of currency in the form of notes and coin the so-called seignorage .
