Targeted longer-term refinancing operations
Under targeted longer-term refinancing operations (TLTROs), credit institutions may borrow from the Bank of Lithuania or other Eurosystem central banks under favourable terms for periods of up to three years.
Third series of targeted longer-term refinancing operations (TLTRO III)
On 7 March 2019 (along with 12 September 2019, 12 March 2020 and 30 April 2020 amendments), the Governing Council of the European Central Bank (ECB) decided to launch a new series of quarterly targeted longer-term refinancing operations (TLTRO-III), starting in September 2019 and ending in March 2021, each with a maturity of three years. These new operations will help to preserve favourable bank lending conditions and the smooth transmission of monetary policy.
The minimum possible interest rate may be 50 basis points below the average interest rate on the deposit facility rate (DFR), the maximum possible interest rate of the operation may be the average interest rate on the main refinancing operations (MRO).
The specific interest rate to be applied will depend on the participant's net lending performance over the life of the operation.
More details are available on 30 April 2020 ECB press release.
Second series of targeted longer-term refinancing operations (TLTRO II)
On 10 March 2016, the Governing Council of the European Central Bank (ECB) decided to further incentivise bank lending to the real economy and launch four second series targeted longer-term refinancing operations (TLTRO II). All of the new operations have a four-year maturity. These operations are conducted from June 2016 at a quarterly frequency.
The interest rate applied to amounts borrowed may range from the main refinancing rate to the deposit facility rate depending on the counterparty’s lending performance.
Counterparties will be able to repay the amounts borrowed under TLTRO II at a quarterly frequency starting two years from the settlement of each operation. Counterparties will not be subject to mandatory early repayments.