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Greece comes under pressure from ECB

Greece comes under pressure from ECB

The European Central Bank (ECB) has announced that Greek government bonds will no longer be eligible as collateral for commercial banks.

The central bank issued the suspension as the recently elected Syriza party continued talks with creditors about its bailout terms.

In a statement, the ECB said it had decided to lift the waiver “affecting marketable debt instruments issued or fully guaranteed by the Hellenic Republic”.

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It said: “The waiver allowed these instruments to be used in Eurosystem monetary policy operations despite the fact that they did not fulfil minimum credit rating requirements.

“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 central bank confirmed that the decision does not affect the counterparty status of Greek financial institutions in monetary policy operations.

The statement followed a meeting between ECB chairman Mario Draghi and Greece’s new finance minister Yanis Varoufakis yesterday (February 4).