Central Banks

Monday, November 12, 2012 - 12:45

Update: ECB Broadens Eligible Collateral For Greek ELA -Press

-- ECB Declines To Comment On Report

FRANKFURT (MNI) - The European Central Bank has widened the collateral pool Greek banks can use to access emergency liquidity assistance from the Greek central bank, the German daily Die Welt reported Monday, citing Eurosystem sources.

The move increases Greece's chances of financing itself by issuing new short-term debt to avert a default until Athens receives the next aid tranche from Brussels, the report said.

The ECB declined on Monday evening to comment on the report.

While the ECB will maintain its decision to reduce the total volume of Greek T-bills it will accept in ELA funding from a temporary E7 billion back to E3 billion, Greek banks will have access to more cash as the central bank will now accept other additional poorly-rated securities held by banks.

Using this cash, banks then have the opportunity to buy sovereign debt enabling the much-needed bridge funding for the country, the newspaper reported.

--Frankfurt newsroom, +49-69-720-142; jtreeck@mni-news.com

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