Banks Park $1 Trillion of LTRO Money Back at ECB
Published: Friday, 2 Mar 2012 | 4:42 AM ET
By: Reuters
Commercial banks parked a record 777 billion euros ($1.03 trillion) with the ECB overnight, roughly three-quarters of the money the central bank has shovelled into the financial system in two injections of ultra-cheap three year funding since December.
Banks took 530 billion euros at this week's second offering of ECB three-year loans, adding to the 490 billion they took at the first one back at the end of last year.
Having received the latest ECB money on Thursday, data on the amounts deposited overnight at the central bank published on Friday showed banks parked 776.9 billion euros straight back at the ECB after getting their cash.
The high
level of deposits at the
bank
highlights the ongoing lack of
trust between European
banks as a result of the
debt crisis that has long
blighted the money market.
Banks only
receive 0.25 percent on money they park with the ECB, compared with the near
one percent they could get lending it for three-months on the open market.
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