User:Aminebrr/sandbox

The interventions of ECB in the eurozone crisis
In 2009-2010, due to substantial public and private sector debt, and "the intimate sovereign-bank linkages"* the eurozone crisis impacted periphery countries. This resulted in significant financial sector instability in Europe; banks' solvency risks grew, which had direct implications for their funding liquidity. The European Central Bank (ECB), as the monetary union's central bank, responded to the sovereign debt crisis with a series of conventional and unconventional measures, including a decrease in the key policy interest rate, and a three-year Long-Term Refinancing Operation (LTRO) liquidity injections in December 2011 and February 2012, and the announcement of the Outright Monetary Transactions (OMT) program in the summer of 2012. The ECB acted as a de facto lender-of-last-resort (LOLR)* to the euro area banking system (e.g., in the LTROs), providing banks with cash flow in exchange for collateral, as well as a buyer of last resort (BOLR)* (e.g., in the OMT), purchasing eurozone sovereign bonds. However, the ECB's policies have been criticized for their economic repercussions, as well as its political agenda.