FRANKFURT (MNI) – The purpose of the European Central Bank’s two
three-year longer-term refinancing operations was to address banks’
short-term funding issues and “nothing else,” ECB Vice President Vitor
Constancio said on Wednesday.
“The sole aim of the LTRO was to cater to the funding stress of
euro area banks in general,” Constancio said at a colloquium on
macro-prudential regulation here. “It never crossed our minds that we
were solving the sovereign debt crisis” with these measures.
The central banker also underlined that banks are well aware of the
fact that they cannot build up their balance sheets with temporary ECB
funds. Banks “want to go back” to the market, Constancio said.
Furthermore, the ECB vice president noted that the first users of
the LTROs were no longer the most significant users of the ECB’s deposit
facility.
–Frankfurt bureau: +49 69 720 142; email: frankfurt@marketnews.com —
[TOPICS: MT$$$$,M$$CR$,M$X$$$,M$$EC$,MGX$$$]
