BBC News
January 4, 2012
It is not an ideal time of year to judge conditions in banking markets, because so much real business closes down over Christmas and new year.
But even allowing for that distortion, what's going on at eurozone banks is troubling.
Here are the relevant statistics.
On 21 December, the European Central Bank provided an unprecedented 489bn euros of three-year loans to the eurozone's banks. That represented a net addition of central bank lending to the banks of 191bn euros (because some banks converted shorter term ECB loans into three-year loans).
Now at that time of year, you wouldn't expect the banks to put all that net 191bn euros of new money to work in a proper sense: it will take time for that money to be used repaying the banks' own debts that fall due for repayment, or providing new loans to customers.
So inevitably a lot of it would end up back at the European Central Bank, on deposit overnight.
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