Spanish Bank ECB Borrowing Declines as Funding Conditions Ease
Net average ECB borrowing dropped to 378.2 billion euros ($487.1 billion) from 388.7 billion euros in August, the Bank of Spain said on its website today. Gross borrowing was 399.9 billion euros, down from 411.7 billion euros a month earlier.
The July pledge by ECB President Mario Draghi to do “whatever it takes” to defend the euro has helped reduce borrowing costs and opened the door for banks including Banco Santander SA (SAN) and Banco Sabadell SA (SAB) to sell bonds. The net ECB borrowing figure of 378.2 billion euros compares with 69.3 billion euros a year earlier, a sign of how reliant Spanish lenders have become on ECB funding.
“Since Draghi’s ‘whatever it takes’ speech, funding conditions have gotten better for Spain and the other peripheral nations,” said Tobias Blattner, an economist at Daiwa International in London. He said it was still too early to read a firm trend in the improved September numbers.
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