The European Central Bank's unprecedented three-year long-term refinancing operations, or LTROs, have bought time for euro-zone banks to shore up their balance sheets, but haven't cured underlying structural problems in the financial sector, Standard & Poor's Ratings Services said Wednesday
Earlier, the ECB announced it had alloted 529.5 billion euros ($713.4 billion) in cheap loans in its second-ever three-year LTRO
"By substantially reducing debt refinancing risk as an immediate concern, the ECB's intervention has allowed banks more time to adapt their balance sheets and strategies to the new market and regulatory context. To this end, we expect another challenging year as banks continue to de-leverage, sell or close noncore businesses, recognize problem assets, and accumulate capital through various means," S&P said, in a statement
"The trying economic and market conditions form a difficult backdrop for this transition."
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