News

Euro zoned banks borrow EUR 1.31 trillion from ECB

Monday 22 June 2020 14:49 CET | News

Banks from the euro zone have borrowed EUR 1.31 trillion from the European Central Bank (ECB).

ECB’s targeted-longer term refinancing operations (TLTROs) were redesigned earlier in 2020 to help the economy cope with the COVID-19 crisis, and banks will get the cash for a rate as low as minus 1%.

At EUR 1.31 trillion, take up is above expectations with most analysts predicting a figure just over EUR 1 trillion for the three-year loans. According to Reuters, although borrowing was more than twice as big as in any previous ECB facility, the net take is smaller as banks likely rolled over around EUR 750 billion worth of earlier ECB funding to take advantage of record low rates.

The negative interest rate means banks that tapped the auction will earn 0.50% for one year with no strings attached and 1% if they simply refrain from shrinking their loan book. The interest rates for the remainder of the loan’s duration will be as low as the ECB’s deposit facility, currently minus 0.5%.


More: Link


Free Headlines in your E-mail

Every day we send out a free e-mail with the most important headlines of the last 24 hours.

Subscribe now

Keywords: banks, ECB, European Central Bank, loans
Categories: Banking & Fintech | Payments General
Countries: Europe
This article is part of category

Banking & Fintech