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This article was published on February 5, 2015 at 06:36.
The last change is the February 5, 2015 at 07:16.
The European Central Bank has effectively suspended last night funding to Greek banks, revoking them ability to deliver on a guarantee public debt securities of Athens in exchange for cash and opening a new chapter in the dramatic crisis in Greece. “It is not currently possible to assume a successful conclusion of the review of the program ‘agreed by the previous government greek with international creditors, says a statement issued late at night by the ECB.
The current program expires on 28 February and the new government has repeatedly stated they did not want to renew. The decision of the ECB increases the pressure on Athens because it stores a new agreement with the European partners, since at this point the only way for Greek banks to obtain liquidity through the door emergency (Ela) of the national central bank, and Also this tool can be revoked by the ECB with a two-thirds majority. In this case, Greece could be forced exit from the euro.
The decision of the ECB, which takes effect on February 11, was taken after a long board meeting, which began in mid-afternoon, in which, according to monetary sources, representatives of several central banks have insisted for the measure. The ECB normally accepts as collateral for its refinancing operations of the banks of the eurozone countries t he public debt of the countries that have a rating of “investment grade”, then at least a triple B. The only two exceptions are Greece and Cyprus , to which, however, was far from a waiver (“Waiver”) by virtue of the economic program under way, which includes a series of commitments in terms of fiscal consolidation and economic reforms in exchange for aid. At this point, and given the negotiating position of the new government greek, which also has backtracked on some of the measures contained in the program, the ECB has judged that the program had almost fallen.
Banks Greek, says the press release, are counterparts of the ECB, but at this point will have access to liquidity in Frankfurt only with collateral quality, you probably have not. Otherwise, should consult their national central bank with the Ela.
The day started with a meeting between the president of the ECB, Mario Draghi, and the new Finance Minister greek, Yanis Varoufakis, from which was soon found that the ECB intended to clearly limit the expectations of the Government of Athens can get grants and funds by the Institute in Frankfurt in the absence of an agreement with the European partners. In a meeting scheduled for this morning in Berlin with his German counterpart, Wolfgang Schaeuble, will likely receive answers even harder and you will hear repeated that Greece must first of all respect the commitments already made. After the meeting lasted about an hour, the president, said a source from the ECB, “explained the statutory mandate of the bank and urged the new government to deal constructively and quickly with the Eurogroup to ensure the continuation of stability financial. ” The reference is to the meeting of finance ministers of the euro zone, expected next week. Behind the jargon from the c entral bank, and in the face of the statements at the end of Varoufakis meeting, that it was a meeting “fruitful” and “excellent”, from which came out ‘encouraged’, there is a clear reference to the political and the fact that the continuation of support to Greek banks depends on an agreement with Europe. Message heavily reinforced by the statement released last night.
By the admission of the same minister (“Draghi told us what the limits of its action”), as of the morning there was the recognition that are inadmissible some of the proposals, the ECB releases these days by the government greek, before the cancellation of the debt, then the transformation of Greek bonds purchased by the ECB in 2010-2012, more than 6 billion euro of which are in reimbursement between July and August, in securities “perpetual” on which Athens would pay only the interest of fact. The ECB is also contrary to the hypothesis circulated from Athens to raise the roof of the emissions of short-term debt from 15 billion to 25 billion Euros and do buy from domestic banks, which could then use it to refinance in Frankfurt. The declaration of Varoufakis that “the ECB is the central bank of Greece and will do all that is necessary to support the eurozone members’ clashes with the stake always place by Draghi that” whatever it takes “should be” inside mandate “and, as we know, has increased the irritation within the board of the ECB against the attitude of Athens.
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