ECB Raises Limit on Securities Lending to Ease Year-End Crunch
- Lending limit against cash collateral raised to €250 billion
- Move comes amid mounting concern over market dysfunction
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The European Central Bank has increased the amount of securities that central banks in the euro area can lend out against cash collateral, a bid to satisfy demand for high-quality liquid assets around year-end.
The limit on such transactions will be 250 billion euros ($250 billion) as of Nov. 10, compared with 150 billion euros previously, the ECB said in a statement. “This is a precautionary measure to ease collateral scarcity and support market functioning around the year-end,” said Executive Board member Isabel Schnabel in a tweet.