securities, as collateral.
ARTICLE 18
Open market and credit operations.
18.1. In order to achieve the objectives of the ESCB and to carry out its
tasks, the ECB and the national central banks may:
- operate in the financial markets by buying and selling outright (spot
or forward) or under repurchase agreement and by lending or
borrowing claims and marketable instruments, whether in Community
or in non-Community currencies, as well as precious metals;
- conduct credit operations with credit institutions and other market
participants, with lending being based on adequate collateral.
18.2. The ECB shall establish general principles for open market and
credit operations carried out by itself or the national central banks,
including for the announcement of conditions under which they stand
ready to enter into such transactions.
ARTICLE 19
Minimum reserves
19.1. Subject to Article 2, the ECB may require credit institutions
established in Member States to hold minimum reserves on accounts
with the ECB and national central banks in pursuance of monetary
policy objectives. Regulations concerning the calculation and
determination of the required minimum reserves may be established
by the Governing Council. In cases of non-compliance the ECB shall
be entitled to levy penalty interest and to impose other sanctions with
comparable effect.
19.2. For the application of this Article, the Council shall, in accordance
with the procedure laid down in Article 42, define the basis for
minimum reserves and the maximum reserves and the maximum
permissible ratios between those reserves and their basis, as well as
the appropriate sanctions in cases of non-compliance.
ARTICLE 20
Other instruments of monetary control
The Governing Council may, by a majority of two thirds of the votes
cast, decide upon the use of such other operational methods of
monetary control as it sees fit, respecting Article 2.
The Council shall, in accordance with the procedure laid down in
Article 42, define the scope of such methods if they impose obligations
on third parties.
ARTICLE 21
Operations with public entities.
21.1. In accordance with Article 104 of the Treaty, overdrafts or any
other type of credit facility with the ECB or with the national central
banks in favour of Community institutions or bodies, central
governments, regional, local or other public authorities, other bodies
governed by public law, or public undertakings of Member States shall
be p