"It's not clear what the exit strategy [for the banks] might be," said Sands, underlying his concern that many European banks still have to refinance a lot of their loans in the next few years.
The risks of quantative easing are relatively unknown in the UK. That's because QE, as it's called, hasn't been used widely before. It's an option used for when interest rates can't dip any lower. So the Bank of England injects money directly into the economy. Printing money, in other words, albeit electronically.
Running out of options?
One of Sands' chief concern is that it's difficult to know what the long-term consequences of this action wil be. The central banks are also increasingly concerned about pursuing the policy. Federal Reserve chairman Ben Bernanke - Bernanke recently released more than $2 trillion worth of government bonds - has sounded increasingly lukewarm on the issue.
In the UK, the Bank of England floodgates has released more than £300bn into the economy so far. "By and large, I don't think there's any hard and fast expectation that we're inevitably going to do much more," Bank of England boss Mervyn King told Parliament recently.
Emergency useEurozone banks will certainly need to have revived themselves sufficiently by the end of the latest European Central Bank three-year long-term refinancing operation, a form of QE. And they should know that three year ECB loans, giving them dirt-cheap money - interest rates of just 1% - should be used for emergencies only.
Yet 800 European banks - a huge number - took advantage of a lot more cheap ECB cash yesterday. There's now considerable anxiety that although the transition of funds might be good news for bank shareholders, there are question marks over how much of this cash is being funneled back into the wider economy.