ECB says banks to repay 3.48 bn euros in ultra-cheap loans

The European Central Bank said Friday that 27 eurozone banks will repay early 3.48 billion euros ($4.7 billion) of ultra-cheap three-year loans next week.

Under emergency liquidity measures, known as long-term refinancing operations or LTROs, made available to banks in December 2011, the ECB gave banks the option of repaying any part of the money after just one year.

Already this week 278 banks repaid 137.16 billion euros of the LTROs.

The LTROs -- with a total volume of just over 1.0 trillion euros -- were launched in two batches, in December 2011 and February 2012.

At the time, they were widely credited with pulling Europe back from the brink of a dangerous credit crunch.

Both rounds of LTRO included provisions to allow early repayment after one year, if banks so chose, with the first repayment window opening on January 30, and the second on February 27.

After that, repayments can continue on a weekly basis, depending on demand.

Some experts believe the magnitude of the repayments is a sign of the improved health of the financial markets as it suggests banks are enjoying better access to funding.