ECB’s Villeroy Says No Monetary Reason to Raise Reserve Requirements

The European Central Bank shouldn’t change reserve requirements for banks as part of its monetary policy, Governing Council member Francois Villeroy de Galhau said.

The current system mandates that banks deposit 1% of certain liabilities at the ECB. In July, when officials decided to stop paying interest on minimum reserves, some also wanted to raise the amount required from banks, arguing that 2% had been the rule before 2011.