ECB sets aside 69 million euros after Steinhoff loss

June 20 (Reuters) - The European Central Bank has set aside 68.9 million euros ($79.83 million) to cover the loss on a corporate bond bought as part of its stimulus programme, the Banque de France said on Wednesday.

It was probably related to debt issued by Steinhoff, which the ECB decided to sell at a loss in January after the South African retailer became embroiled in an accounting scandal .

The ECB never disclosed the size of the loss, which had fuelled criticism of its Corporate Sector Purchase Programme - the second-largest component of a 2.6 trillion-euro money-printing programme aimed at boosting inflation.

“Following an impairment test conducted on the CSPP portfolios, the Governing Council has deemed it necessary to make a provision for a total amount of 68.9 million euros for losses on monetary policy operations relating to one security held by a Eurosystem central bank,” the Banque de France said.

The Steinhoff bond was bought by the Bank of Finland, but the risk associated with credit purchases are shared among all of the euro zone’s 19 central banks.

Some lawmakers, academics and activists deem credit purchases too risky for central banks because companies can go bust.

“However marginal relative to the ECB’s unlimited financial resources, the Steinhoff loss ... shows the ECB’s logic of buying whatever the market provides is clearly flawed,” said Stanislas Jourdan, head of activist group Positive Money Europe.

Positive Money Europe calls for the ECB to spend its money on debt issued by the European Investment Bank or on causes such as green finance.

The ECB expects to stop buying new bonds at the end of the year, but it plans to reinvest the money it receives from debt that matures for a long time. ($1 = 0.8631 euros) (Reporting By Francesco Canepa, editing by Larry King)