UPDATE 2-ECB reactivates bond-buy plan with record amount

* ECB spends 22 bln euros on bonds, most in any week

* Analysts say record amount is not still not enormous

(Adds Issing in paragraph 7)

FRANKFURT, Aug 15 (Reuters) - The European Central Bank
spent a record 22 billion euros on government debt last week,
reactivating its controversial bond-buying plan to try to halt
the spread of the euro zone debt crisis to Spain and Italy.

The amount bought, reported by the ECB on Monday, was the
most the central bank has spent in any week since it began the
programme in May last year, surpassing the 16.5 billion euros
spent in the first week, when it targeted Greek bonds.

Victoria Cadman, an economist at Investec, said the ECB
would need to be active in the bond market for a few weeks yet.

"The ECB is doing quite a lot to pop up Italy and Spain and
help to push down their yields. The number is relatively big,
but it is not enormous," she said.

The ECB reactivated the programme after leaving it dormant
for 19 weeks, and despite opposition from a four-man group on
its policymaking Governing Council, led by Germans Jens Weidmann
and Juergen Stark.

The four dissenters were concerned about the ECB moving into
the fiscal policy arena but the majority on the Governing
Council felt obliged to act as euro zone governments had failed
to come up with adequate plans to stem the spread of the crisis.

The dissenters' resistance was echoed by former ECB chief
economist Otmar Issing, who told German television station ZDF:
"This cannot be the task of a central bank. If it gets involved
in political business, that endangers its independence."

The central bank began buying bonds again directly after a
Governing Council meeting on Aug. 4, ECB President Jean-Claude
Trichet said, with traders saying it had been in the market for
Irish and Portuguese bonds.

However, as the purchases take 2-3 days to settle, those
transactions, as well as those made at the start of last week
show up in the data published this Monday.

Last week, the ECB said it would "actively implement" the
bond-buying programme to fight the debt crisis, signalling it
would buy Spanish and Italian government bonds to halt financial
market contagion.

French President Nicolas Sarkozy and German Chancellor
Angela Merkel will discuss on Tuesday how to make the euro zone
work more effectively amid persistent doubts in financial
markets over Europe's ability to solve its debt crisis.

One of Germany's leading economic associations came out in
favour of joint euro zone bond issuance on Monday, raising
pressure on Merkel to consider bolder crisis steps ahead.

The ECB also said no bonds held under the programme matured
last week. Thus, when rounded to the nearest half billion, the
overall value of the purchases -- albeit not marked to market --
rose to 96 billion euros ($135.2 billion). (For full details
click )

The ECB and the 17 euro zone national central banks can buy
government and corporate bonds from banks and other investors
under the programme, but not directly from governments.

As usual, the ECB will take one-week deposits from
commercial banks on Tuesday to neutralise the monetary impact of
the purchases and the inflationary pressure they create.

The ECB does not break down its bond purchases. However,
bond market traders and analysts say, until last week, buying
had been limited to Greek, Irish and Portuguese bonds and
estimate that it holds around 45 billion euros of Greek debt.

For Reuters ECB information page on bond purchases, see
.

Date Bonds bought Bonds matured
14/05/2010 16.5
21/05/2010 10
28/05/2010 8.5
04/06/2010 5.5
11/06/2010 6.5
18/06/2010 4.2
25/06/2010 4
02/07/2010 4
09/07/2010 1
16/07/2010 0.302
23/07/2010 0.176
30/07/2010 0.081
06/08/2010 0.009
13/08/2010 0.01
20/08/2010 0.338
27/08/2010 0.142
03/09/2010 0.173
10/09/2010 0.237
17/09/2010 0.323
24/09/2010 0.134
01/10/2010 1.384
08/10/2010 0.009
15/10/2010 0
22/10/2010 0
29/10/2010 0
05/11/2010 0.771
12/11/2010 1.073
19/11/2010 0.713
26/11/2010 1.348
03/12/2010 1.965
10/12/2010 2.667
17/12/2010 0.603
24/12/2010 1.121
31/12/2010 0.164
07/01/2011 0.113
14/01/2011 2.313
21/01/2011 0.146 0.087
28/01/2011 0
04/02/2011 0
11/02/2011 0
18/02/2011 0.711 0.040
25/02/2011 0.369
04/03/2011 0
11/03/2011 0
18/03/2011 0 0.170
25/03/2011 0.432 1.054
01/04/2011 0
08/04/2011 0 0.055
15/04/2011 0 0.830
22/04/2011 0
29/04/2011 0
06/05/2011 0
13/05/2011 0
20/05/2011 0 1.227
27/05/2011 0
03/06/2011 0
10/06/2011 0
17/06/2011 0 1.008
24/06/2011 0
01/07/2011 0
08/07/2011 0
15/07/2011 0
22/07/2011 0 0.245
29/07/2011 0
05/08/2011 0
12/08/2011 22.0

Total 96.0
(Reporting by Frankfurt newsroom; Editing by Catherine Evans)

($1=.7099 Euro)