PARIS — After more than a year of frustrating and mostly fruitless summit meetings of European political leaders, the European Central Bank appears to have found a more promising way to ease the euro zone crisis: give money to banks at bargain-basement rates.

The E.C.B., making an offer too good for Europe’s banks to refuse, reported Wednesday that it had doled out almost half a trillion euros in low-cost three-year loans to keep credit flowing at a time when European banks are finding it all but impossible to finance their operations through normal market channels.

The lending reduces the “risk of a Lehman-type situation, where banks go into the new year facing a wave of refinancing and are unable to access the market,” said Jacques Cailloux, the chief euro zone economist at Royal Bank of Scotland.

But it is probably only a temporary solution. By acting essentially as a lender of last resort to the European financial system, the E.C.B. managed mainly to buy time for Europe to work out its longer-range problems of excessive debts, lagging economic competitiveness and limited fiscal unity.

The E.C.B. allocated €489.2 billion, or $639 billion, to 523 institutions, well above the roughly €300 billion estimate of analysts polled by Reuters and Bloomberg News.

Even as Mario Draghi, the new E.C.B. president, continues to resist calls to stand directly behind sovereign debtors without limit, the scale of the liquidity injection suggested that the E.C.B. is prepared to indirectly support them through the banking system.

Carl B. Weinberg, chief economist at High Frequency Economics and a self-described bear on the European outlook, said he was stunned by the size of the monetary operation, saying it suggested Mr. Draghi had “shown a path toward averting catastrophic collapse in Europe.”

http://www.nytimes.com/2011/12/22/business/global/demand-for-ecb-loans-surpasses-expectations.html?hp=&pagewanted=print