FXStreet (Córdoba) – The European Central Bank decided to leave the Emergency Assistance Liquidity (ELA)ceiling for Greek banks unchanged at €89 billion.
Additionally ECB “adjusted” the haircuts it applies to the assets which Greek banks can use as collateral. In simple terms, the ECB have toughened terms of its support to Greek banks.
Full statement:
The Governing Council of the European Central Bank decided today to maintain the provision of emergency liquidity assistance (ELA) to Greek banks at the level decided on 26 June 2015 after discussing a proposal from the Bank of Greece.
ELA can only be provided against sufficient collateral.
The financial situation of the Hellenic Republic has an impact on Greek banks since the collateral they use in ELA relies to a significant extent on government-linked assets.
In this context, the Governing Council decided today to adjust the haircuts on collateral accepted by the Bank of Greece for ELA.
The Governing Council is closely monitoring the situation in financial markets and the potential implications for the monetary policy stance and for the balance of risks to price stability in the euro area. The Governing Council is determined to use all the instruments available within its mandate.
(Market News Provided by FXstreet)