The subprime crisis became a banking crisis due to the exposures banks had to the subprime assets which were fast turning bad. Counterparty concerns exacerbated, leading to freezing of global interbank markets. The crisis had spread to other jurisdictions through various channels of contagion – trade, finance and most importantly, confidence.
The pass-through of the monetary policy measures put in place since June 2014 continues to significantly support borrowing conditions for firms and households, access to financing ‒ notably for small and medium-sized enterprises ‒ and credit flows across the euro area.