Ecb Lifts Waiver Of Min. Rating Requirements On Greek Bonds

- The European Central Bank (ECB) lifted current waiver of minimum credit rating requirements for marketable instruments issued or guaranteed by the Greek Government, shifting the burden onto Central Bank of Greece, to finance the banks.

"The instruments in question will cease to be eligible as collateral as of the maturity of the current main refinancing operation (11 February 2015)" said the ECB in a statement, released on its website.

With the decision of the Governing Council of the European Central Bank, Greek debt with low credit ratings can no longer be used as collateral in in the Eurosystem's monetary policy operations.

The waiver had allowed the stated instruments to be used in Eurosystem monetary policy operations despite the fact that they had not fulfilled minimum credit rating requirements, the ECB said. "The Governing Council decision is based on the fact that it is currently not possible to assume a successful conclusion of the programme review and is in line with existing Eurosystem rules."

The decision came just hours after Greece's new finance minister Yanis Varoufakis, had a meeting with ECB President Mario Draghi. Draghi said that the ECB would do "whatever it takes" to support member states such as Greece and Varoufakis said they were certain on the ECB's support.

The decision did not bear consequences for the counterparty status of Greek financial institutions in monetary policy operations, the Bank said, while, liquidity needs of Eurosystem counterparties, for counterparties that did not have sufficient alternative collateral, can be satisfied by the relevant national central bank, by means of emergency liquidity assistance within the existing Eurosystem rules.