This has led not only to a reduction in the interest rates on such transactions, but also to a revival in a market which had dried up, or even to the establishment of such markets in countries where they did not yet exist, such as Italy. It is difficult to ask more of monetary policy in a market economy. Our role is limited to the provision of liquidity to solvent banks. This role does not include the recapitalisation and restructuring of the banking system, which is an important step to restore trust in the financial sector. We expect banks to take a more active role in the process of recapitalisation. As the ECB has stressed a number of times, banks must take full advantage of government measures to support the banking sector, in particular as regards recapitalisation, not least because the banking system cannot be supported indefinitely by the extraordinary measures taken by central banks. An exit strategy will inevitably need to be implemented in due course. Banks which decide not to make use of government support measures must find alternative sources, in the market, in order to be ready to step up their lending to the real economy once the recovery begins. While the slowdown in bank lending observed in recent months can perhaps in part be explained by the fall in economic activity, the failure of banking flows to pick up when demand recovers would be more difficult to justify.
Background charts: Chart A: Short-term MFI interest rates on new loans (percentages per annum, monthly averages)  12  BIS Review 129/2009  Chart B: Long-term MFI interest rates on new loans (percentages per annum, monthly averages)  Chart C: MFI loans to households in the euro area: contributions by country (percentage points; annual percentage changes; quarterly, quarterly data are averages, nsa)  Source: ECB. BIS Review 129/2009  13  Chart D: MFI loans to non-financial corporations in the euro area: contributions by country (percentage points; annual percentage changes; quarterly, quarterly data are averages, nsa)  Source: ECB. 14  BIS Review 129/2009  Chart E: MFI loans to households in the euro area: annual growth by country (percentage changes)  Source: ECB. BIS Review 129/2009  15  Chart F: MFI loans to non-financial corporations in the euro area: annual growth by country (percentage changes)  Source: ECB. 16  BIS Review 129/2009