The asset purchase programme (APP) was the Eurosystem's asset purchase programme of public and private sector securities conducted between the end of 2014 and mid-2023 with the aim of providing further monetary stimulus, in addition to that arising from the key interest rates, with a view to ensuring the smooth transmission of monetary policy, in an environment of prolonged low inflation and of key interest rates that had reached their effective lower bound.
The APP included the following four programmes, covering both public and private sector securities:
The third covered bond purchase programme (CBPP3, launched on 20 October 2014), under which the Bank of Italy purchased covered bank bonds on the primary and secondary markets, according to a breakdown that took account of the weight of the respective national markets.
The asset-backed securities purchase programme (ABSPP, launched on 21 November 2014), for the purchase of securities issued following the securitization of bank loans. Under this programme, starting on 1 April 2017, the Bank of Italy took on the role of asset manager for Italian securities on the primary and secondary markets. In the initial phase, the ABSPP outsourced its trading activities to external asset management companies.
The public sector purchase programme (PSPP, launched on 9 March 2015), provided for the purchase of securities issued by governments, public sector agencies and international organizations located in the euro area. Under this programme, the Bank of Italy purchased Italian public sector securities, but only on the secondary market.
Under the corporate sector purchase programme (CSPP, launched on 8 June 2016), the Bank of Italy was one of the six national central banks tasked with purchasing - on both the primary and secondary markets - securities issued by private non-bank corporations located in the euro area, including commercial paper of sufficient credit quality.
All the programmes entailing purchases of private sector securities adhere to the principle of risk sharing among the Eurosystem national central banks based on their capital key (their percentage share in the ECB's total subscribed capital). With the PSPP, instead, the Bank of Italy bears all the risks associated with the purchases made under the programme. For ECB purchases of government securities, both Italian and of other euro-area countries, and for purchases of securities issued by European supranational entities, which together covered 20 per cent of the total PSPP, the principle of risk-sharing between Eurosystem national central banks applies.
For more detailed information on how the programmes and their features developed over time, see the section on the Eurosystem's public and private sector securities purchase programmes.
