The physical damage to financial institutions in the areas hit by the earthquake was enormous, including the destruction and flooding of some branches. Thanks to the dedicated efforts of those involved, financial institutions have been gradually starting to get their branches and offices in those areas back on their feet.
After the ECB President’s pledge “to do whatever it takes to preserve the euro” in the period following the OMT announcement, tensions in sovereign bond markets subsided, with Spanish and Italian ten-year government bond yields to fall significantly. In essence, the ECB reaffirmed its full commitment to our price stability mandate, sending a strong message to financial markets.