Bank of England and European Central Bank (ECB) have extended their reciprocal swap agreement until Sept. 28, 2012. Established in December 2010, the swap deal will allow the ECB to offer sterling liquidity to its counterparties. The central bank of the U.K. will provide the ECB with sterling in exchange for euro up to a maximum of £10 billion. The agreement had been originally set up to ensure funding security for Irish banks that are heavily exposed to the U.K., adds Reuters.
Click here for the release from Bank of England.
Click here for additional coverage from Reuters.