BERLIN: There are no limits set in advance to the European Central Bank's new bond-buying programme but the ECB will stick to risk management principles when implementing the plan, Governing Council member Yves Mersch said on Tuesday.
Mersch, who is expected to secure a vacant position on the bank's Executive Board, also said the new programme - dubbed Outright Monetary Transactions (OMT) - was limited in time.
The ECB has taken some of the heat out of the euro zone debt crisis by last month unveiling the OMT, though it has urged governments not to ease up on reforms.
"There are no volume limits set in advance for the OMTs," Mersch said in the text of a speech to be given in Berlin.
"However, in the operative design, risk management was not neglected."
Mersch gave no further indication as to what sort of constraints risk management principles would suggest. ECB President Mario Draghi has said only that there are no ex ante limits to purchases.
Sources have also told Reuters that the ECB would buy heavily in the first one to two months and then suspend purchases for an assessment period.
The ECB has yet to buy any bonds through the programme, which was announced in September.
The central bank has said that it would buy bonds only after a country signed up for a rescue plan and adhered to strict reform conditions.
Mersch also said the only similarity between the new programme and the previous one, called Securities Markets Programme, or SMP, was that both were limited in time - otherwise their design and goals are different.
Mersch said he would prefer to have the International Monetary Fund involved in bailouts.
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