European Central Bank: Changes to new targeted longer-term refinancing operations
The European Central Bank has modified some of the key parameters of the third series of targeted longer-term refinancing operations (TLTRO III).
The move is aimed at preserving favourable bank lending conditions, ensuring smooth functioning of the monetary policy transmission mechanism and further supporting accommodative stance of monetary policy.
The amendments cover the following:
- interest rate on TLTRO III operations to be reduced;
- rate can be as low as the average interest rate on deposit facility; and
- maturity extended to three years, from two years, with repayment option after two years.
Above changes will apply as of the first TLTRO III operation to be allotted on September 19, 2019.