Q: Could you elaborate a bit more on the choice of the TLTRO with T instead of an LTRO; what have been the reasons for this?
Draghi: The first LTROs were quite effective for the time when they had been designed. But they were used – not 100% of course – but they were used also to kind of buy sovereign bonds. At that time, the yields on bonds were high and banks especially in parts of the eurozone, where to lend to the economy was very risky because these parts were in huge recession, they bought sovereign bonds. What then we wanted to achieve with the “T” was to make sure to minimise this possibility to make sure the banks borrow at a very good rate, but in order to lend to the economy and to firms and households in the private sector, not to buy sovereign bonds.