Non-standard measures are estimated to be particularly effective in counteracting bank funding and financial fragmentation in some jurisdictions. This is reflected also in the lending conditions faced by the real economy. In June 2014 the median lending rate for firms in vulnerable economies was 120 basis points higher than for those in stronger ones – despite overnight rates being close to zero.
Today the difference is only 20 basis points. These improvements have led to rising credit volumes and improved access to finance, especially for small and medium-sized enterprises. Loan growth has proceeded along a path of gradual recovery since 2014. And across financial intermediaries, the banks which participated in the TLTROs have experienced higher loan dynamics than the non-participating ones.