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Disappointing bank take-up of ECB stimulus loans


Disappointing bank take-up of ECB stimulus loans


The European Central Bank has reported a rather low take-up of loan money in its latest stimulus package.

ECB head Mario Draghi is hoping the four-year loans to banks will help head off deflation and revive the flagging eurozone economy.

Of the 400 billion euros on offer, 82.6 billion euros was lent out to 255 eurozone banks.

They will have a second chance in December to apply for the cash, which is granted on condition that it is lent on to businesses.

The scheme is central to the ECB’s efforts to coax reluctant banks to lend more to boost the bloc’s economy.

But previous rounds of ultra-cheap ECB loans – and borrowing costs close to zero – have done little to boost lending to companies, with much of the money instead used to buy government bonds. Critics fear a similar fate for the new scheme.

with Reuters

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