ECB restricts Greek banks' access to cheap liquidity

The European Central Bank (ECB) has restricted Greece's access to cheap liquidity on concerns its new government is not committed to existing bailout pledges.

Since 2010 Greek banks had been able to access funds from the ECB secured against junk-rated collateral, but lenders must now apply for funding from their national central bank at higher rates. The ECB last night brought forward a decision that it had been expected to make on 28 February, and said Greek government debt currently pledged as collateral under ECB refinancing operations will no longer be eligible as of 11 February, when the current operation matures. The move follows a meeting between Greek finance minister Yanis Varoufakis and ECB president Mario Draghi (pictured) regard...