Asset sales alone will be insufficient, and additional capital will still be needed. Over time, acquisitions of the weak by the strong will play an important role. At the moment, valuation uncertainties, some accounting standards and investor caution are all restraining mergers and acquisitions in the sector.
Yields on bank and non-financial bonds have eased in response to the measures taken, testifying to the effectiveness of the current monetary policy. Funding conditions for banks improved as wholesale money market rates turned negative and as banks received direct support from new liquidity facilities with four-year maturities and low rates (TLTRO-I and II).