More than 30 central banks express interest as ECB begins EUREP onboarding

The European Central Bank has begun onboarding foreign central banks to its enhanced euro repo backstop, and more than 30 central banks have shown interest, a sign that the ECB’s plan to broaden access to euro liquidity outside the euro area is moving from policy design into operation.

Philip R. Lane, the ECB’s chief economist and a member of its Executive Board, said in remarks published Wednesday that the first foreign central banks completed onboarding at the beginning of October. “More than thirty central banks have expressed interest in EUREP in the past six months,” Lane said in the text of a speech delivered in Shanghai at the CF40-Euro50 luncheon “Monetary System Beyond the Dollar.”

EUREP, or the Eurosystem repo facility for central banks, is a standing backstop that lets non-euro-area central banks borrow euros from the Eurosystem against high-quality euro-denominated collateral. Lane said the ECB has enhanced the facility to make it “more flexible and effective” in supporting the transmission of euro-area monetary policy.

Under the new framework, standing access is available in principle to all central banks, unless they are excluded for reasons including money laundering, terrorist financing or international sanctions. The ECB has said drawings will be available from the fourth quarter of 2026 once onboarding is complete.

ECB materials set out the main operating terms. Pricing is based on the ECB’s main refinancing operations rate plus a spread set by the Governing Council, meant to preserve the facility’s role as a backstop rather than a routine funding source. Standard transaction maturities run from one day to one week, with the possibility of extension, and the maximum line size for each central bank is 50 billion euros, or about $54 billion at current exchange rates. The ECB also said in July that it would publish the total daily amount of liquidity provided under EUREP and euro swap lines every week.

Lane framed the repo line as one part of a broader euro liquidity toolkit, not a substitute for swap lines. EUREP provides euro loans against euro-denominated collateral. Swap lines, by contrast, can be extended against local-currency collateral and can channel euro liquidity through foreign central banks into their domestic banking systems. Lane said that makes swap lines useful through different transmission channels, but also riskier than EUREP. For that reason, he said, swap lines should be offered only to foreign central banks “that are clearly capable of repaying their euro debt in due course,” with the backing of a highly rated sovereign.

The remarks were not a new formal policy announcement. The ECB introduced EUREP in 2020 during the COVID-19 crisis as a precautionary backstop. It announced the decision to broaden the facility on Feb. 14, 2026, and set out the operational details and onboarding process on July 24.

Lane’s speech offered a progress update on that rollout. One confirmed public example is Danmarks Nationalbank, Denmark’s central bank, which announced access to the enhanced facility on Oct. 1.

Lane said the ECB sees wider euro liquidity lines as a way to support smoother monetary-policy transmission, reduce stress in euro funding markets and bolster the international role of the euro. “The provision of liquidity is a basic task for a central bank,” he said.

He also stressed that such facilities are meant for periods of strain, not day-to-day use. “Given their backstop pricing, international liquidity lines are designed to be drawn down only in response to shocks and in crisis situations,” Lane said. “However, their mere existence – even without being drawn upon – can help to prevent adverse market dynamics from arising in the first place.”