The ECB continues its relentless march of balance sheet expansion. For the first time the total assets of the Eurosystem have exceeded €3.1 trillion.
Jean-Claude Trichet used to argue that unlike the Fed's balance sheet during 2008-09 period, the Eurosystem assets were dominated by securities, gold, and foreign reserves, rather than loans to banks. That composition is changing quickly however. Here it the ECB's balance sheet assets breakdown from a year ago - with circled items representing lending to Eurozone's banking institutions under various programs.
And here is the current balance sheet asset breakdown. Lending to banks went from under a quarter of the balance sheet to close to half (47%) in a year. Trichet would have a tough time makeing the same statement today.
And this expansion shows no sign of abating as loans to Eurozone's financial institutions continue to grow, rapidly approaching one and a half trillion euros.