BUSINESS

ECB says waiver for Greek debt revoked, effective Aug. 21

TAGS: Banking, Euro

The European Central Bank announced on Friday it is revoking a waiver on Greek bonds, with the decision coming into effect on August 21, a day after the country will officially exit from its third bailout program.

ECB's waiver allows Greek debt to be accepted as collateral for regular auctions of ECB cash, despite the junk rating of the country's bonds. Removing it will shut the lenders' access to cheap funding.

Since Greece will no longer be in an adjustment program, the criteria for accepting the waiver will no longer apply.

“From that date (Aug. 21), the conditions for the temporary suspension of the Eurosystem’s credit quality thresholds in respect of marketable debt instruments issued or fully guaranteed by the Hellenic Republic ... will no longer be fulfilled,” the bank said in a press release. 

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