Bank: Italian bonds are large share of holdings

FRANKFURT, Germany - The European Central Bank says Italian government bonds account for nearly half of its total holdings under a now discontinued bond-buying program launched in 2010 to ease the eurozone's debt crisis.

The bank on Thursday detailed for the first time what countries' bonds it acquired under the so-called Securities Markets Program, which it started when the euro area's debt crisis flared in May 2010.

The central bank for the 17 European Union countries that use the euro said it held bonds with a face value of 218 billion euros ($287 billion) - 102.8 billion euros of them from Italy ($135 billion).

Spain accounted for the second-biggest holding, with bonds nominally worth $58 billion. The bank also holds Greek bonds with a face value of $44 billion, Portuguese bonds worth $30 billion, and Irish bonds totaling $18.7 billion.

The program was aimed at easing the eurozone's crisis over too much government debt in some countries. It sought to lower bond-market borrowing costs for indebted countries so that they were more in line with the central bank's low benchmark interest rates. But the program failed to convincingly keep the rates down, so the bank halted it last year and replaced it with a new, bolder program.

The bank has in the past said how many bonds it bought overall in any given week, but it never revealed what countries' bonds it bought and in what specific amounts.

It is revealing that information now as part of a transparency policy meant to increase confidence in its new bond-buying program, dubbed Outright Market Transactions.

Under the new program, which has yet to buy any bonds, the bank will buy a country's bonds in the open market only if that country enters into a formal agreement with the eurozone bailout fund to curb its deficits and debt.

Buying bonds raises their price and lowers their interest yield, which reflects a country's borrowing costs. That's because price and yield move in opposite directions.