ECB Said Seeking 10% Boost to its ABS Holdings by Fridayby
The European Central Bank is planning to boost its holdings of asset-backed securities, seeking as much as 1.6 billion euros ($1.7 billion) in two rounds of purchases this week, according to two people familiar with the matter.
The central bank offered to buy up to 550 million euros of Spanish securitizations from investors on Thursday, according to the people, who asked not to be identified because they’re not authorized to talk about the plan. It will seek as much as 1.1 billion euros of Dutch mortgage bonds on Friday, the people said.
This week’s targets are equal to more than 10 percent of the Frankfurt-based institution’s existing holdings of securitized debt, which at 15.4 billion euros is the smallest part of the 677 billion euros spent under the ECB’s asset purchase program. The central bank is acquiring asset-backed securities, which bundle individual loans into bonds that can transfer risk to investors from banks, to encourage lenders to offer more credit.
An ECB spokesman declined to comment on the ABS purchase program.