The Riksbank’s measures in connection with the corona pandemic
The Riksbank implemented a large number of measures in 2020 to alleviate the economic effects of the coronavirus pandemic and to support the Swedish economy. Through these measures, the Riksbank has helped to facilitate access to credit and liquidity. This has reduced the risk of a shortage of money and sharply rising interest rates exacerbating the situation. The measures have been gradually terminated as the situation has improved and the need has diminished. The Riksbank has gradually phased out its asset purchases. Purchases of all asset types ended at the turn of the year 2022/2023. The Riksbank's asset holdings have decreased during 2022. The holdings will continue to decline after 2022 as assets mature.
The amounts in the row above show the envelopes decided on for each of the Riksbank’s measures, and the amounts in the row below show how much, in total, has been utilised in the different programmes. Regarding the purchases of interest-bearing securities, the envelope of SEK 700 billion has been set on the basis of total purchases of government bonds, covered bonds and municipal bonds; for treasury bills and commercial paper, it is set on the basis of holdings.
*)Total volume utilised is affected by the fact that the Riksbank’s holdings of commercial paper are SEK 0 billion, compared with the offer to hold up to SEK 32 billion within the envelope.
Reduced the overnight lending rate to banks
The Riksbank reduced the overnight lending rate loans to banks from +0.75 percentage points (prior to the pandemic) to the repo rate +0.10 percentage points to ensure that the overnight rate on the market for Swedish krona is close to the repo rate. This measure was taken to make it less expensive for the banks to have access to overnight loans.
Extended purchases of securities
The Riksbank intended to purchase securities in an amount of up to SEK 700 billion, up to 31 December 2021, in addition to the purchases planned prior to the pandemic. The aim was to facilitate credit supply and mitigate the downturn in the economy. This included purchases of government bonds, treasury bills, covered bonds (mortgage bonds), municipal bonds and corporate securities (commercial paper and corporate bonds).
The Riksbank’s extended purchases of securities
Purchases of government bonds
Purchases of treasury bills
Purchases of covered bonds (mortgage bonds)
Purchases of commercial paper
Purchases of corporate bonds
Purchases of municipal bonds
Eased collateral requirements when borrowing from the Riksbank
The Riksbank eased the requirements regarding the collateral the banks can use when borrowing from the Riksbank. The reason was that the banks’ access to liquidity in Swedish krona might need strengthening in connection with the coronavirus pandemic. The collateral requirements that were in place before the corona pandemic will be reintroduced in January 2022.
Funding to banks to support corporate lending
The Riksbank offered funding to banks of up to SEK 500 billion against collateral to stimulate their lending to banks to support corporate lending. The programme has been terminated.
Loans in US dollars
The Riksbank offered the banks the possibility of loans in US dollars against collateral, up to a total of USD 60 billion. The purpose was to increase access to liquidity in US dollars in the Swedish financial system. The programme has been terminated.
The riksbank is lending unlimited amounts of sek against collateral
The Riksbank offered banks the opportunity to borrow an unlimited amount of money on a monthly basis against collateral at three and six months’ maturity respectively to the repo rate. This was to facilitate their financing and safeguard their role as credit suppliers to Swedish companies. The programme has been terminated.
More banks and credit institutions have the possibility to borrow money from the Riksbank
The Riksbank granteds Swedish credit institutions under the supervision of Finansinspektionen the opportunity to become temporary monetary policy counterparties to the Riksbank. Also temporary monetary policy counterparties were given the opportunity to participate in the programme for lending to non-financial companies via banks. The opportunity to become a temporary monetary policy counterparty has been removed.