ECONOMY

Heavy ECB reliance

Greek and Irish banks’ reliance on European Central Bank (ECB) loans is out of proportion to the size of their assets, according to ratings agency Fitch. Greek banks accounted for 6.6 percent of the 749 billion euros the ECB lent to financial companies by the end of 2009, though the lenders only held 1.6 percent of the euro area’s banking assets, Fitch said in a report yesterday. Irish lenders took 12 percent of ECB funding, compared to a 5.24 percent share of the region’s bank assets. «Greece, Ireland and, to a more limited extent, Spain and the Netherlands, have been more extensive users of ECB liquidity than in previous years,» according to the report. The increased use of ECB facilities «could indicate a reliance on these sources for structural funding needs or as a boost to flagging profitability.» Meanwhile, peer Moody’s lowered its rating on 22 billion euros of Greek bonds backed by loans to consumers and companies, leaving the notes under review for a further ratings cut.