ECB to pur­chase cov­ered bond

The Pak Banker - - Front Page -

FRANKFURT: To­day Coun­cil of the Euro­pean Cen­tral Bank (ECB) had de­cided on the CBPP2, the tech­ni­cal modal­i­ties of which were pub­lished on 3 Novem­ber 2011. The pur­chases of cov­ered bonds com­menced in Novem­ber 2011. The aim of the pro­gramme was to con­trib­ute to eas­ing fund­ing con­di­tions for credit in­sti­tu­tions and en­ter­prises and to en­cour­ag­ing credit in­sti­tu­tions to main­tain and ex­pand their lend­ing to cus­tomers. The ini­tially tar­geted to­tal nom­i­nal amount of pur­chases was €40 bil­lion, and the pur­chases were expected to have been car­ried out in full by 31 Oc­to­ber 2012. As al­ready an­nounced at the press con­fer­ence of 4 April 2012, the ECB had slowed down the pace of pur­chases in re­sponse both to in­vestors’ in­creas­ing de­mand for euro area cov­ered bonds and to the de­cline in the sup­ply of cov­ered bonds.

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