Banks borrow €529bn from ECB in latest LTRO

European banks have borrowed €529bn from the European Central Bank in the second tranche of its three-year long-term refinancing operation (LTRO), asking for more support than forecast.

Analysts forecast the ECB would lend between €200bn to €1rn, but the total figure was above the median of €500bn. The fresh injection into the European financial system comes after the first tranche in December, when the ECB injected €489bn of three-year cheap loans into the market. In total 800 banks sought funds this time, as opposed to 523 in the first LTRO. The stimulus is expected to support the recent risk rally in markets triggered by the first tranche of the LTRO in December. Some commentators have suggested the wave of new money could stave off the threat of another cre...