ECB TLTROII Review: €45bn take-up, €35bn fresh money – RBS

Research Team at RBS, notes that the Euro Area banks borrowed €45bn in the second TLTROII operation and taking into account voluntary and compulsory repayments of earlier TLTROI borrowings the net fresh money creation amounts to €35bn.

Key Quotes

“This was well under our forecast of a €160bn headline takeup. The programme isn’t as successful as we had hoped for in spite of offering attractive economics. The lack or credit growth coupled with banks unwillingness to increase their asset purchases lead us to revise down our expectations for total takeup. In our opinion the lack of enthusiasm to the programme must be a disappointment for the ECB who made €1.5tn available to Euro Area banks.”