How should a monetary policy be chosen in the euro zone when banks’ situation and credit growth are very different from one country to the next?

If euro-zone banks are faced with: A very negative marginal interest rate on their deposits at the ECB; A sharp increase in their liquidity due to quantitative easing, they should normally want to increase their lending, which is probably the ECB's objective. But this leads to two major problems: If banks lack capital to lend more, they will deposit their excess liquidity at the ECB at a negative interest rate, which will reduce their profitability and capital even more; T his monetary policy does not take into account the fact that bank credit is growing rapidly (too fast) in France and Germany, and declin ing in Spain and Italy. So boosting credit growth is ineffective in France and Germany if, in addition, credit drives up real estate prices and companies’ cash reserves. The ECB’s suggested monetary policy therefore makes no sense unless it is backed by a very active macroprudential policy that would reduce lending in France and Germany.