A Rabobank spokesman has said they won’t be drawing funds from the TLTRO next week.
They didn’t draw from the first one and say that they have sufficient capacity to meet an expected increase in demand. They see no constraints to lend to SME’s from a funding perspective.
If these comments are indicative of most banks then we shouldn’t be looking for a bigger take up next week. Some analysts said that banks held back on the first one due to the stress tests but I think that the system has plenty of liquidity to lend and the main reason is a lack of demand. In that scenario it doesn’t matter how much money you have to through at the economy.
