— Correcting To Show Paper Did Not Report Spain Got More Loans
BERLIN (MNI) – The European Central Bank is widening its internal
controls on the application of collateral rules, the German daily Die
Welt reported Monday.
National central banks of the Eurozone member states, for example,
will have to supervise each other more closely in the application of
collateral rules, the newspaper said.
The main reason for the closer supervision is that Spanish T-Bills
used as collateral in refinancing operations have only partially
fulfilled ECB requirements, Die Welt wrote. It did not reiterate its
previous assessment that failure to adhere to collateral standards has
resulted in Spanish banks receiving more loans.
“Spanish banks did not receive higher credit than warranted. Even
in the case that higher haircuts had been applied, the overall
collateral value would have exceeded the liquidity provided,” an ECB
spokeswoman confirmed. “Therefore, the Eurosystem did not extend more
credit than justified.”
ECB president Mario Draghi last month also said that the mistake in
applying collateral rules on Spanish T-Bills didn’t have any impact on
the amount of loans. Still, he announced that the Eurosystem Audit
Committee will assess the implementation of the collateral framework
across the Eurozone.
The ECB has now confirmed that the Governing Council approved last
Thursday the improved surveillance measures drawn up by a committee led
by Bank of Finland governor Erkki Liikanen, Die Welt wrote.
–Berlin bureau: +49-30-22 62 05 80; email: twidder@mni-news.com
[TOPICS: M$X$$$,MGX$$$,M$$CR$,M$$EC$]
