One person familiar with the matter said the ECB had been buying short-dated covered bonds from a number of different countries, in sizes up to €25 million ($32 million).
Covered bonds are backed by a pool of loans such as residential mortgages, and are widely considered as the safest type of debt that banks sell.
The ECB’s covered bond program is part of a package of stimulus measures announced in September that included interest rate cuts to fresh record lows and planned purchases of asset-backed securities.
The ECB doesn’t have a target amount for the purchases. But President Mario Draghi said last month the central bank was seeking to expand its balance sheet toward levels last seen in early 2012, suggesting the combined scheme—including a new bank-lending program—could be worth at least €700 billion.
It is unclear how much in total it has bought, or sought to buy, Monday. The ECB will announce its weekly purchase amounts each Monday, starting next week.
Analysts reckon the amount of covered bonds the ECB can buy will depend on how aggressively it bids for bonds.
Barclays said in early October that even though there is potentially €545 billion of covered bonds available in the secondary market, dwindling new issuance means investors may be reluctant to sell existing holdings, making it difficult for the ECB to buy bonds in large quantities.
"The ECB indicated that it would be ready to hold a share of up to 70% of individual bonds, but we believe that reaching such a high ownership rate could be achieved only when accepting a significant distortion of valuations,” Barclays wrote in a note to clients.
For the ECB, the hope is that by raising the supply of money in the eurozone economy, banks will lend more to households and businesses and boost economic activity and inflation in the process. Annual inflation was 0.3% in September, far below the ECB’s target of just under 2%.
This is the ECB’s third covered bond program since 2009. Under the first program, the ECB purchased €60 billion of these securities. A second program fizzled, however, with the ECB buying less than half of the €40 billion it had targeted.