In Italy, for example, bank lending conditions for firms remained remarkably resilient in recent years despite significant swings in market-based funding conditions of the sovereign, banks and firms. Again, our measures can provide a valuable bridge to the future and help keep aggregate external funding costs of firms stable until the economy recovers and uncertainty diminishes further.
Two other features of our package reinforce the bank lending channel. These are, first, our plain-vanilla longer-term refinancing operations (LTROs), which provide abundant liquidity to banks at favourable rates at a time when term funding has become scarce and more expensive. The second feature relates to the easing in collateral standards for lending operations.