The European Central Bank is the de facto successor of the European
Monetary Institute (EMI). The EMI was established at the start of the
second stage of the EU's Economic and Monetary Union (EMU) to handle
the transitional issues of states adopting the euro and prepare for
the creation of the ECB and European System of Central Banks (ESCB).
The EMI itself took over from the earlier European Monetary
Co-operation Fund (EMCF).
Wim Duisenberg, first President of the ECB.
The ECB formally replaced the EMI on 1 June 1998 by virtue of the Treaty on European Union (TEU, Treaty of Maastricht), however it did not exercise its full powers until the introduction of the euro on 1 January 1999, signalling the third stage of EMU. The bank was the final institution needed for EMU, as outlined by the EMU reports of Pierre Werner and President Jacques Delors. It was established on 1 June 1998.
The first President of the Bank was Wim Duisenberg, the former president of the Dutch central bank and the European Monetary Institute. While Duisenberg had been the head of the EMI (taking over from Alexandre Lamfalussy of Belgium) just before the ECB came into existence, the French government wanted Jean-Claude Trichet, former head of French central bank, to be the ECB's first president. The French argued that since the ECB was to be located in Germany, its President should be French. This was opposed by the German, Dutch and Belgian governments who saw Duisenberg as a guarantor of a strong euro. Tensions were abated by a gentleman's agreement in which Duisenberg would stand down before the end of his mandate, to be replaced by Trichet, an event which occurred in November 2003.
There had also been tension over the ECB's Executive Board, with the United Kingdom demanding a seat even though it had not joined the Single Currency. Under pressure from France three seats were assigned to the largest members, France, Germany, Italy and Spain. Despite such a system of appointment the board asserted its independence early on in resisting calls for interest rates and future candidates to it.
When the ECB was created, it covered a Eurozone of eleven members. Since then, Greece joined in January 2001, Slovenia in January 2007, Cyprus and Malta in January 2008, and Slovakia in January 2009, enlarging the bank's scope and the membership of its Governing Council.