ECB temporarily suspends Greek bonds as collateral

The European Central Bank said on Tuesday it was suspending the eligibility of Greek bonds for use as collateral but that national central banks could provide liquidity to banks using so-called «emergency liquidity assistance.»

Greek bonds would become eligible in principle again once a collateral enhancement scheme, agreed by eurozone governments last year, is activated.

“This is expected to take place by mid-March 2012,» the ECB said in a statement. [Reuters]