The decision to modify the terms and conditions of the third series of targeted longer-term refinancing operations (TLTRO-III) was justified by the need to ensure that the contribution of this instrument is also consistent with the broader normalisation process of monetary policy.
The recalibration intends to strengthen the transmission of official rate increases to the conditions of bank loans and to remove the constraints on the process of reducing the Eurosystem's balance sheet through the early repayment of TLTRO-III operations.