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     LONDON (MNI) - A fresh round of cheap funding for banks will be firmly on
the agenda of the European Central Bank's next meeting, with three eurosystem
sources telling MNI that chances were rising of an announcement of a fresh round
of targeted longer-term refinancing operations as soon as March 7.
     "By now it is almost certain that the issue of more TLTROs will be
formally, for the first time, addressed at the Governing Council meeting in
March. There will be no extension of current TLTROs, rather a new fresh round
with a slightly tweaked version compared to the latest ones and likely with a
2-year maturity," one eurosystem source said.
     "It would not be a surprise to anyone if a fresh round is announced tout
court at the March press conference," the source said, adding that "the exact
nature and scope of the new TLTROs might be communicated at a slightly later
stage and will take into account the overall financial outlook of the eurozone,
not the needs of specific countries or banks."
     Another eurosystem official told MNI that fresh TLTROs would be announced
in March, to be made available from May. A third source said that while it was
not certain that a final determination on TLTROs would be taken in March, it was
possible that a broad policy decision could nonetheless be announced at the
meeting, with details coming in April.
     Fresh TLTROs will differ from earlier rounds, and be "less of a subsidy for
banks", the third source said, stressing that March "will be an important
meeting."
     A fourth eurosystem source, though, was more doubtful, stating that there
was no consensus on the issue in the Governing Council and noting that it was
necessary to properly examine options including that of providing long-term
refinancing operations instead of TLTROs, as well as issues such as the
maturities of the loans, before taking a decision.
--MNI London Bureau; +44 203 865 3829; email: jason.webb@marketnews.com
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