Adding to the cyclicality in commercial property lending is the fact that these loans have tended to be among the most risky of bank loans. That was the case in the early 1990s and it has again been the case recently.
It lowered its main refinancing rate to 1% in May 2009 and, in order to facilitate banks’ borrowing of central bank funds, it expanded the range of eligible collateral for its refinancing operations. It also provided liquidity to the banking sector elastically – with no ex ante limit.