Are the loans for indirect bank recapitalisation disbursed as cash?

Loans to ESM Members for indirect bank recapitalisation are generally paid ‘in kind’ rather than ‘in cash’.  For this purpose, the ESM issues notes (i.e bills and/or bonds) and transfers them to the beneficiary country, which uses them to inject capital in the distressed banks. The ESM notes are later converted into cash loans.

For more detailed information, please consult the ESM Guideline on Recapitalisation of Financial Institutions (PDF, 366 KB).