FRANKFURT Dec 6 Refinancing problems among
European lenders have declined markedly, said German state
development bank KFW, a major fundraiser and lender in
Europe's biggest economy.
"The market environment can be described as strained but, by
and large, calm primarily thanks to the measures taken by the
central banks," Guenther Braeunig, management board member in
charge of capital markets, said on Thursday.
The European Central Bank and its peers flooded financial
markets with extra cash to help prop up tottering banks, which
had been afraid to lend to one another during financial crisis.
Fears were still running high a year ago as the European
debt crisis intensified and U.S. money market funds withdrew
dollar liquidity from Europe, prompting Braeunig to say at that
time the situation was comparable with Lehman's 2008 collapse.
In the intervening year, banks have made progress building
up equity capital buffers against downturns and in cleaning up
their balance sheets.
"Bank liquidity has improved markedly," Braeunig said,
adding that many banks have been able to place unsecured bonds.
"Investors have become more willing to take on risk," he
told a news conference.
Despite these positive signs, it was still too early to give
the all clear, with the euro debt crisis rumbling on. "It will
again be a challenging year for the euro area in 2013," he said.
Government-backed KFW has taken advantage of Germany's AAA
credit rating and the favourable funding conditions that brings,
raising about 78.4 billion euros in 2012 through 200 different
transactions in 15 currencies as of Nov. 30. "We are able to
issue in all markets every day," Braeunig said.
The lender expects to raise 70-75 billion euros next year to
fund its development business, with the slight decline compared
with 2012 due to higher loan repayments and continuing low
(Reporting by Kathrin Jones; Writing by Jonathan Gould; Editing
by Dan Lalor)