Published by Global Banking & Finance Review®
Posted on February 14, 2026
3 min readLast updated: February 14, 2026
Add as preferred source on GoogleThe ECB will make its euro liquidity backstop globally available and permanent by 2026 to enhance the euro's international role.
FRANKFURT, Feb 14 (Reuters) - The European Central Bank unveiled plans on Saturday to widen access to its euro liquidity backstop, making it globally available and permanent in a bid to bolster the international role of the single currency.
Access to such repo lines, a crucial source of funding during times of market stress, has been limited to just a handful of mostly Eastern European countries but ECB President Christine Lagarde has long seen the facility as a tool to boost the euro's global reach.
"The ECB needs to be prepared for a more volatile environment," Lagarde said at the Munich Security Conference, the first time an ECB chief spoke at the event.
"We must avoid a situation where that stress triggers fire sales of euro-denominated securities in global funding markets, which could hamper the transmission of our monetary policy," she said in announcing the new facility.
The facility, to be available from the third quarter of 2026, will be open to all central banks around the world, provided they are not excluded for reputational reasons, such as money laundering, terrorist financing or international sanctions, the ECB said.
"This facility also reinforces the role of the euro," Lagarde said. "The availability of a lender of last resort for central banks worldwide boosts confidence to invest, borrow and trade in euros, knowing that access will be there during market disruptions."
Used when banks are unable to obtain funding on the market, the repo line allows lenders to borrow euros from the ECB against high-quality collateral, to be repaid at maturity along with interest.
Unlike previous lines, which had to be extended from time to time, the new facility will provide standing access for up to 50 billion euros.
With investors reassessing the dollar's status due to the unpredictable nature of U.S. President Donald Trump's economic policy, Lagarde has argued this was the time for the euro to gain market share, but this required a revamped financial and economic architecture.
The U.S. Federal Reserve maintains a similar tool, called the FIMA Repo Facility, which essentially protects the Treasury market since stress might otherwise force lenders to sell government bonds below market value.
"These changes aim to make the facility more flexible, broader in terms of its geographical reach and more relevant for global holders of euro securities," the ECB said in a statement.
Such a guaranteed access to euros could naturally increase demand for euro-denominated assets and encourage banks outside the 21-nation euro zone to buy assets from the bloc.
For a factbox on the details of the new repo facility, click here.
(Reporting by Balazs KoranyiEditing by Tomasz Janowski)
The European Central Bank (ECB) is the central bank for the euro and administers monetary policy within the Eurozone, aiming to maintain price stability and manage inflation.
A liquidity backstop is a financial mechanism that provides emergency funding to banks or financial institutions during times of market stress or liquidity shortages.
Monetary policy refers to the actions taken by a central bank to control the money supply, interest rates, and inflation to achieve economic stability.
A repo line is a financial arrangement where lenders can borrow funds from a central bank using high-quality collateral, typically for short-term liquidity needs.
Central banks manage a country's currency, money supply, and interest rates, and they often serve as a lender of last resort to maintain financial stability.
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