Eligibility of Greek bonds used as collateral in Eurosystem monetary policy operations

In a decision taken on the 4 February 2015 the European Central Bank (ECB) toughened its stance with Greece by restricting financing to the country's banks.

In a statement, the central bank said it would no longer accept Greek government bonds as collateral for lending money to commercial banks. 'The Governing Council decision is based on the fact that it is currently not possible to assume a successful conclusion of the program review and is in line with existing Eurosystem rules'.

Greek Finance Minister Yanis Varoufakis had earlier met ECB President Mario Draghi in Frankfurt.

Deutsche Welle wrote that 'time's now running out for Greece as the European portion of its rescue package is due to expire at the end of the month [28 February 2015]. Failure to negotiate an extension is bound to lead to a messy bailout exit, with the prospect of state bankruptcy looming large'.

• Primary Source

BBC News, 05.02.15: European Central Bank toughens its stance on Greece http://www.bbc.co.uk/news/business-31142437

Deutsche Welle, 05.02.15: Markets react to ECB action on Greece http://dw.de/p/1EVnW

Deutsche Welle, 04.02.15: Varoufakis, Draghi talks no real breakthrough http://dw.de/p/1EVOd

Kathimerini, 04.02.15: ECB fires warning shot by refusing to accept Greek gov't bonds as collateral http://www.ekathimerini.com/4dcgi/_w_articles_wsite1_1_04/02/2015_546901

Kathimerini, 05.02.15: Tsipras talks with Draghi following ECB decision to reject Greek bonds http://www.ekathimerini.com/4dcgi/_w_articles_wsite1_1_05/02/2015_546911

ESO: Background information: Juncker rejects Greek debt write-off http://www.europeansources.info/record/juncker-rejects-greek-debt-write-off/

ESO: Background information: Greece's Tsipras says optimistic for 'viable' solution with EU http://www.europeansources.info/record/greeces-tsipras-says-optimistic-for-viable-solution-with-eu/

EUObserver, 05.02.15: ECB ratchets up pressure on Greece https://euobserver.com/political/127501

ESO: Background information: Greece talks to abandon bailout fail http://www.europeansources.info/record/greece-talks-to-abandon-bailout-fail/

ESO: Background information: The Greek debt crisis: Key sources http://www.europeansources.info/record/the-greek-debt-crisis-key-sources/

ESO: Background information: Greece and the euro area: What next after the Greek election? http://www.europeansources.info/record/greece-and-the-euro-area-what-next-after-the-greek-election/

EurActiv, 05.02.15: ECB sends warning message to Athens http://www.euractiv.com/sections/euro-finance/ecb-sends-warning-message-athens-311857

Euro|Topics: Main focus, 05.02.15: ECB not convinced by Athens' reform course http://www.eurotopics.net/en/home/presseschau/archiv/archiv_dossier/DOSSIER157888-ECB-not-convinced-by-Athens-reform-course

Blog: Open Europe, 05.02.15: ECB turns off the taps, but Greek banks can still get funding http://openeurope.org.uk/blog/ecb-turns-taps-greek-banks-can-still-get-funding/

Deutsche Welle, 05.02.15: ECB said to expand lifeline to Greek banks http://dw.de/p/1EWFA

Euronews, 04.02.15: ECB ups the pressure on Greece and its promises to renegotiate its debt http://www.euronews.com/2015/02/04/ecb-ups-the-pressure-on-greece-and-its-promises-to-renegotiate-its-debt/

Blog: Open Europe, 06.02.15: ECB finally leaves politics to politicians http://openeurope.org.uk/blog/ecb-finally-leaves-politics-politicians/

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