Banks to return 5.98 billion euros in crisis loans to ECB next week
FRANKFURT (Reuters) - Banks will return 5.975 billion euros (4.75 billion pounds) in long-term loans to the European Central Bank next week after it launched another plan to boost the economy on top of a four-year loan programme due to start later this month.
The amount that banks will repay on Sept. 17 is less than this week's crisis-loan repayments of 9.111 billion euros but surpasses the 3.5 billion forecast in a Reuters poll.
The ECB has cut interest rates to record lows - taking its the deposit rate to below zero - and taken steps to boost lending to euro zone companies. It has also pledged to do more if needed to fight off the risk of Japanese-style deflation.
The measures include a new four-year loan scheme, which the ECB hopes will encourage banks to boost their lending.
Banks continue to repay LTRO funds they took from the ECB in late 2011 and early 2012 as they go through ECB health checks, which are in their final stages now with a Europe-wide bank stress test.
On Friday, the ECB said five banks would repay 2.6 billion euros from the first LTRO on Sept. 17 and 11 banks would pay back 3.375 billion from the second LTRO.
(Reporting by Paul Carrel and John O'Donnell; Editing by Ruth Pitchford)
