The second tLTRO did not work: it seems like the banks are not crazy about the concept of “helping the economy”, what did we expect ?
“Don’t help the economy, help yourself” seems to be like a good slogan, especially if you are a bank.
You all remember the first disappointing tLTRO (or LTRO 3):
The maximum amount of money the ECB was willing to lend amounted to €400 billion.
The first tLTRO reached €82.6 billion.
The second tLTRO reached, as we now know, €184 billion.
The revised expectation for the two tLTROs amounted to €267 billion, the actual number was €212 billion.
Yes, the tLTRO was worse than the first two LTROs:
European stocks (mainly banks) went up after these number were announced.
Why ? Easy, the Euro-QE is now closer than it was before thanks to this flop.