The ECB's first offering of almost half a trillion euros in cheap, three-year funds at the end of last year and the prospect of a similar take-up at a second tender on Feb. 29 have been hailed as removing the risk of a major credit crunch and a chain of bank failures across the euro zone.
But the extra ECB cash has so far not persuaded lenders to introduce new credit lines or significantly extend the length of their existing funding agreements. Weak banks remain frozen out of money markets while the strong fear exposure to risky peers.
A marked pick-up in banks' ability to borrow money in the market - whether from other banks or money market funds - would encourage them to fund businesses and households, helping heavily indebted economies such as Italy and Spain grow.
Access to market cash is mostly restricted to a select group of highly-rated banks in the heart of Europe, such as Germany's Deutsche, Rabobank of the Netherlands and national champions in southern states, such as Spain's Banco Santander, traders say.
