In two long-term refinancing operations which we launched at the end of 2011 and early 2012 banks absorbed a net volume of EUR 500 billion in additional liquidity. The replacement of central bank liquidity for failing market credit has averted devastating prospects of a fully-fledged financial depression.
Lorenzo Bini Smaghi: Intervention at Sveriges Riksbank conference “Monetary policy in an era of fiscal stress” Intervention by Mr Lorenzo Bini Smaghi, Member of the Executive Board of the European Central Bank, in the panel “Challenges for monetary and fiscal policy”, at the Sveriges Riksbank conference “Monetary policy in an era of fiscal stress”, Stockholm, 17 June 2011.