definition of eligible net lending in the tltro series. since there were also two covered bond purchase programmes during 2009 - 2012, the new 2014 version was labelled cbpp3. 5 draghi ( 2014 ) provides a comprehensive contemporary account of the mid - 2014 situation. the pspp buys bonds with remaining maturities in the interval of two years to thirty years. at the end of august 2016, the weighted average remaining maturity of pspp bonds stood at 8. 28 years. my focus here is on the conjunctural assessment about the role of negative rates in the current euro area environment ; i do not address the longer - term debate about the implications of technological changes in payments systems for the setting of policy rates. coeure ( 2016 ), constancio ( 2016a ) and praet ( 2016 ) also provide analyses of the role of negative policy rates in the european context. the interest earnings of households have declined by a similar amount. however, the cash flow gain to indebted households supports deleveraging and boosts consumption growth. 9 some of the channels by which interest rate policy affects bank profitability are captured in the theoretical model developed by brunnermeier and koby ( 2016 ). 10 the structural challenges facing european banks are covered in constancio ( 2016b ) and draghi ( 2016b ). 11 see, amongst many others, geanakoplos ( 2010 ) and buttiglione et al ( 2014 ). 12 the national macroprudential authority is also responsible for improving resilience by setting capital buffers for significant institutions and, where it is permitted under national law, a systemic risk buffer. in addition, macroprudential policy may also prompt increases in risk weights vis - a - vis specific types of lending ( for instance, commercial real estate or mortgage lending ). in some member countries, the central bank is the designated macroprudential authority ; in other countries, the authority is jointly shared by the central bank, the finance ministry and other public stakeholders. since systemic financial risks can also be generated in other sectors of the financial system, an expanded set of instruments to cover non - bank entities and market activities would add to the effectiveness of macroprudential regulations. 5 / 5 bis central bankers'speeches

philip r lane : european central bank monetary policy – an overview address by mr philip r lane, governor of the central bank of ireland, to the new york university stern school of business, new york city, 27 september 2016. * * * it is a pleasure to have the opportunity to address nyu stern ’ s center for global economy and business. 1 today, my aim is provide an overview of the current monetary policy of the ecb ’ s governing council. as a reminder, the press statement following the most recent monetary policy meeting of the governing council on september 8th provided the following summary of the current policy stance : “ based on our regular economic and monetary analyses, we decided to keep the key ecb interest rates unchanged unchanged. we continue to expect them to remain at present or lower levels for an extended period of time, and well past the horizon of our net asset purchases. regarding non - standard monetary policy measures, we confirm that the monthly asset purchases of €80 billion are intended to run until the end of march 2017, or beyond, if necessary, and in any case until the governing council sees a sustained adjustment in the path of inflation consistent with its inflation aim. ” the main elements of the policy package include : a deposit facility rate of minus 40 basis points. since the banking sector collectively must hold considerable excess reserves with the eurosystem, money market rates have been pushed down to deposit facility rate : hence this rate has become the most important policy rate in the current environment. 2 the deposit facility rate was cut from zero to minus 10 basis points in june 2014. it was further cut to minus 20 basis points in september 2014, minus 30 basis points in december 2015 and the current value of minus 40 basis points in march 2016. a series of targeted longer - term refinancing operations ( tltros ) that were initially introduced in june 2014, with a mark - ii programme announced in march 2016. the design of the tltro series provides incentives to banks to expand credit provision to households and non - financial corporates, with the interest rate on the new tltro - ii programme set at the deposit facility rate for those banks that exceed benchmark net lending targets. 3 a set of asset purchase programmes. in september 2014, programmes to buy assetbacked securities and covered bonds issued by private - sector entities were launched ( termed abspp and cbpp respectively ) ; the decision to launch a public sector purchase programme ( pspp ) was taken in january 2015 ; and