ECB phases out bond-market crisis measure

Associated Press + More

FRANKFURT, Germany (AP) — The European Central Bank has phased out one of the crisis measures aimed at supporting the shaky banking system of the 17-country eurozone.

The bank announced Wednesday that its program to purchase covered bonds expired on schedule Wednesday. Covered bonds are backed both by another asset and then by the borrower's ability to pay if the asset doesn't cover any loss.

The bank had said it would buy €40 billion ($52 billion) of the bonds to encourage activity in a market that banks can use to raise operating funds. The bank only bought €16.4 billion as the market proved healthier than anticipated.

A much larger bank support measure — cheap ECB loans of just over €1 trillion for up to three years — remains in place.

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