Given the real risk of a severe tightening of the supply of credit to the economy, the Governing Council of the ECB cut its main refinancing rate by a total of 50 basis points in November and December 2011, introduced three-year refinancing operations (LTROs) providing unlimited liquidity at fixed rates, extended the range of assets eligible as collateral, and halved the compulsory reserve ratio.
In the two LTROs conducted in December 2011 and February 2012 the Eurosystem supplied funds totaling around € trillion to banks in the euro area; taking account of the smaller volume of funds disbursed in other operations, the net increase in the flow of resources to the banking system exceeded € billion.