More than 30 central banks have shown interest in a euro liquidity backstop, European Central Bank (ECB) Executive Board member Philip R. Lane said, as policymakers seek to shield euro markets from funding stress abroad.
In remarks dated Oct. 21 in Shanghai, Lane said the first foreign central banks completed onboarding for the Eurosystem repo facility for central banks, known as EUREP, in early October. The expressions of interest came over the preceding six months.
The ECB announced wider access to EUREP in February and published its operating terms in July. Each approved central bank outside the euro area can obtain a line of up to €50 billion by pledging eligible euro-denominated securities. Approved central banks can draw from the facility in the fourth quarter of 2026 after completing onboarding.
Loans run from one day to one week, with extensions possible. The rate is the ECB’s main refinancing operations rate plus a spread, and access requires Governing Council approval.
Introduced in 2020, EUREP was expanded amid what the ECB described as geopolitical and financial fragmentation. The facility is intended to limit the effects on euro-area markets of euro funding pressure abroad. Lane said international liquidity lines could also help prevent that pressure from pushing up euro money-market rates.
Lane said dependable access to euros may encourage foreign central banks to hold euro bonds as reserves, potentially benefiting the euro-area bond market. He warned that greater reliance on short-term euro borrowing could create funding vulnerabilities.
Currency swap lines carry different risks, Lane said. They can provide euros against a partner’s local currency and support foreign banks more directly. He argued that swaps should be reserved for creditworthy partners whose financial problems could interfere with euro-area monetary policy. His speech reflected his own views, rather than a collective Governing Council position.
Using exchange rates fixed at fourth-quarter 2025 levels, the ECB measured the euro’s share of global foreign-exchange reserves at 20.2% for that quarter. The ECB will publish weekly figures showing the aggregate liquidity supplied each day through EUREP and swap lines.
