Don't miss

Replay


LATEST SHOWS

INSIDE THE AMERICAS

Indigenous peoples: Fighting discrimination

Read more

MIDDLE EAST MATTERS

From Turkey to Iran: (re)inventing kebab

Read more

THE INTERVIEW

Paleontologist Kenneth Lacovara: ‘Dinosaurs were the last great champions’

Read more

THE INTERVIEW

Alan Turing's nephew: ‘A Shakespearean tragedy surrounded his life’

Read more

EYE ON AFRICA

Zimbabwe: Chamisa's lawyers contest election results in court

Read more

THE WORLD THIS WEEK

New US sanctions on Iran: Trump ups pressure after exiting nuclear deal

Read more

IN THE PRESS

‘Space Farce’? Alternative logos for new US military branch flood social media

Read more

EYE ON AFRICA

Zambia accused of illegal handover of Zimbabwean opposition figure

Read more

MEDIAWATCH

#MyCameraIsMyWeapon campaign takes on Iran's mandatory hijab law

Read more

ECB ends Greek banks' access to cheapest credit

© AFP | Greek banks will have to do without the ECB sweetheart deal

FRANKFURT AM MAIN (AFP) - 

The European Central Bank on Friday said it has decided to cancel a special lifeline giving Greek banks access to cheap credit when the country exits its bailout programme later this month.

The lifting of the so-called "waiver" was widely expected as Greece readies to turn the page on a severe debt crisis that has weighed down the country for years.

The waiver, in place since 2016, allowed Greece's stricken banks to benefit from the cheapest ECB credit by exceptionally letting them use the government's junk-rated bonds as collateral.

But after eight years of austerity and painful reforms, Greece is due to leave its third financial rescue on August 20.

The end of Greece's extraordinary circumstances will see the banks' waiver expire the following day, the ECB said in a statement, in what is essentially good news for the country.

Greek banks in need of liquidity will still have access to central bank credit through their National Bank, but at higher rates than those offered by the Frankfurt institution.

Or, the country's banks could offer other types of collateral to access the ECB's cheapest funding, but this is seen as less likely.

Since 2010 Athens has received some 300 billion euros ($343 billion) in rescue money spread over three bailouts, which saved it from crashing out of the eurozone.

While Greece's economy is now in better shape, the bailouts have left it with debt levels at 180 percent of its annual economic output, the highest in the euro area.

ECB chief Mario Draghi said last month that Greece would remain ineligible to take part in the bank's massive monthly asset purchases even after the bailout ends, given the low rating of Greek bonds.

The ECB has spent over 2.4 trillion euros since 2015 buying up government and corporate bonds as part of stimulus efforts to bolster the eurozone economy.

The scheme is set to end in December.

© 2018 AFP