UK Europe steps forward

Further to the view that Euopean banks are even more anxious than their US counterparts for TARP, and to help concentrate minds further, the Bank of England said today it would extend $30bn in cash for a week against eligible collateral i.e. re-opening SLS, though also drawing on currency swap lines put in place earlier with the US Fed. "These operations are intended to address funding pressures over quarter-end," said the Bank ($10bn available for overnight borrowing, though it had agreed to provide $40bn daily in overnight money last week, but so far, there was not the demand for the full amount (for interesting reasons not explored here, that may or may not have had something to do with shotgun wedding of HBoS and LTSB).
Even drier than overnight is 3months money and hence, BoE says it will inject longer term money into sterling markets. Retail banks especially need 3 month money as they pre-order their funding on a quarterly basis.
(It was when Northern Rock couldn't book its next quarter's funds that it had to go begging to the BoE that triggered the bank run). BoE says it'll extend long-term repo operations against extended collateral, including mortgages. As from Tuesday next it will offer £40bn for maturity on January 15 (through year end, and by which time the Democratic Administration will be installed, when TARP if it incredibly fails to pass now will surely be passed then?). UK Bankers welcomed the news. Similar actions will be taken by ECB and other central banks in Europe.