ROME: Italy’s biggest banks borrowed more than 30 billion euros ($32 billion) in the European Central Bank’s third targeted-loan operation, about a third of the total.
Banks across Europe took 97.8 billion euros in targeted loans, or TLTROs, offered by the ECB in an effort to stimulate the economy. That compares with 130 billion euros borrowed in in December and 82.6 billion euros in September.
By tying cheap four-year credit to the size of banks’ loan books, the ECB is betting the funds will spur lending to companies and individuals. Italy, the euro-region’s third-biggest economy, is starting to emerge from its longest recession on record, while the government is considering creating a bad bank to accelerate disposals of banks’ problematic assets.
“Italian banks are willing to take money from the ECB because it’s not perceived as a lack of liquidity but as a signal that they want to increase lending,” said Fabrizio Bernardi an analyst at Fidentiis Equities. “After five years, Italian lenders are finally spurring credit on signals Italy is emerging from recession and firms want to invest for growth.”
Intesa Sanpaolo SpA, Italy’s second-biggest bank, was the biggest borrower among lenders that disclosed their figures, taking 10 billion euros. That’s adding to the 12.6 billion euros borrowed in the first two auctions.
