Euro zone banks borrow $394bln at ECB auction

FRANKFURT- Euro zone banks borrowed 330.5 billion euros at the central bank's three-year auction on Thursday, adding to their firepower to keep extending credit to households and firms in a bloc still struggling with the COVID-19 pandemic.

There range of analyst forecasts ahead of the announcement was wide, starting at less than 50 billion euros and going as high as 275 billion euros, according to IFR.

Banks can earn an interest of up to 1% on the new credit via a negative lending rate if they refrain from shrinking their loan book.

ECB President Lagarde said she was expecting a "reasonably high" take up replace

The new loans replace 233.5 billion euros worth of ECB credit due to be repaid on March 24.

(Reporting By Francesco Canepa Editing by Balazs Koranyi) ((francesco.canepa@thomsonreuters.com; 004906975651247; Reuters Messaging: francesco.canepa.thomsonreuters.com@reuters.net))