The European market for repurchase agreements - an important measure of banks’ confidence in lending to each other which contracted heavily in the wake of US bank collapses during the crisis - showed healthy signs of recovery last year.

The value of outstanding paper in Europe's repo market hit €5.5 trillion ($7.5 trillion) on December 9, up 14.7% compared to the figure on June 10 last year - a time at which the market for interbank lending was still sluggish following a 12-month period in which both Bear Stearns and Lehman Brothers had collapsed.