Banking

ECB move to restrict bank subsidies to cost AIB and BoI up to €100m

European Central Bank to change terms of cheap loans to European banks

European Central Bank: moved last week to change the terms of trillions of euro of ultra-cheap loans to European banks known as targeted longer-term refinancing operations. Picture: Shutterstock

The European Central Bank’s (ECB) move to curb lucrative subsidies to European banks will cost the country’s two largest lenders up to €100 million in foregone income.

The ECB last week moved to change the terms of trillions of euro of ultra-cheap loans known as targeted longer-term refinancing operations (TLTROs).

European banks borrowed the funds for free or, at times, at negative rates. In recent months, since rates have increased, lenders have been able to ...