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ECB Framework: Bank Equity Rallying On Easier Funding

FINANCIALS

ECB framework review: initial thoughts


  • MRR (minimum reserve requirement) unchanged as expected
  • Refi/deposit corridor at 15bp vs. 25bp - generally expected.
  • The latter points to easier funding for banks vs. baseline expectations.
  • STIRs were already very relaxed on that front and Euribor futures haven't had a meaningful reaction. European bank equity rallying as a result.

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