PARIS (MNI) – The European Central Bank’s unlimited long-term
financing of banks is beginning to bear fruit in sovereign funding for
Eurozone governments, ECB Governing Council member Christian Noyer said
Friday.
Recent sovereign debt issues, notably for France and the bailout
fund EFSF, have “gone very well,” the governor of the Bank of France
noted in a radio interview.
“As the refinancing operations went well at the end of last year
and the start of this year, I think it’s starting to work,” Noyer said,
while insisting that more needs to be done.
He noted that banks have sufficient liquidity thanks to the ECB’s
massive refinancing operations, and that sovereign debt is a safe
investment. “I expect banks to be more active in lending to the
economy,” he added.
The ECB is ready to supply as much liquidity to banks in the
upcoming three-year refinancing operation at the end of February as it
did in December, Noyer said. “We believe we can refinance banks
massively without risk.”
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–Paris newsroom, +33142715540; email: ssandelius@marketnews.com
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