In a shocking decision 20 minutes to midnight, the ECB abruptly cancelled its acceptance of Greek bonds in return for funding, warning Athens for a reform deal.
The move, which means the Greek central bank will have to provide its banks with tens of billions of euros of additional emergency liquidity in the coming weeks, was a response to what many in Frankfurt see as the Greek government's abandoning of its aid-for-reform programme.
As of a few minutes past midnight Wednesday, there was no official response from anyone in the new Greek government.
The decision came just hours after Greece's new finance minister Yanis Varoufakis emerged from a meeting with ECB President Mario Draghi to claim that the ECB would do "whatever it takes" to support member states such as Greece.
In stark contrast, the ECB move, which required the support of a majority of central bank chiefs across the euro zone, shows widespread dismay with the new Greek government's plans not only in Frankfurt but across the 19-country bloc.
The ECB announced its decision, which will take effect from Feb. 11, after those governors met in Frankfurt on Wednesday.
It means that the tens of billions of euros of Greek government bonds as well as bank bonds guaranteed by Athens will no longer qualify as security in return for ECB funding to those banks.
- Greek 30-year bond issue attracts strong demand
- The yield on the 10-year bond fell below 1%
- Greece raises 3.0 billion euros with new 10-year bond loan issue
- ECB welcomes positive economic developments in Greece in 2019
- ECB warns eurozone may need 1.5 trillion euros to tackle covid-19 economic crisis
Latest from E.Tsiliopoulos
- Old Acropolis Museum being refurbished as exhibition space
- Embassies: The MyConsulLive service is being expanded
- Aegina International Music Festival returns with 8 music filled nights
- Pandemic: Great concern for the… "orange" islands
- Greek Mission to the Arctic Ocean: Research on Climate Change, Pollution and the Marine Environment