In the US, the decline in real estate prices contributed greatly to the difficulties in the banking system.
By buying bonds, including covered, sovereign and corporate bonds, we are reducing interest rates across a range of horizons. These lower interest rates encourage borrowing, either indirectly through banks or directly in terms of greater issuance of corporate bonds. In terms of the transmission mechanism, we introduced full allotment for our monetary policy tenders, allowing banks to access all the liquidity they need.