Swap line

Unless otherwise defined, the agreement of a central bank with one or more other central banks to borrow foreign currency (xeno currency) liquidity quickly and conveniently from the central bank concerned when needed. In the wake of the financial crisis that followed the subprime crisis, the ECB entered into such agreements primarily with the Swiss and U.S. central banks. – See Dollar Gap, – Cf. ECB Annual Report 2009, p. 113 (details on swap lines with the central banks of the U.S.A. and Switzerland); Financial Stability Report 2011, p. 59 f. (swap line to smooth the dollar funding gap of German banks).

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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
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