NICOSIA, Cyprus (MNI) – The European Central Bank’s decision to
suspend minimum rating requirements for collateral eligibility is
limited to Greece, and the subject has not been broached with respect to
any other Eurozone country, ECB Governing Council member Anathasios
Orphanides said here Monday.
Orphanides, who heads the central bank of Cyprus, said the ECB’s
decision, announced this morning, was based on a positive assessment of
the new austerity plan unveiled by Greece Sunday and of the
determination demonstrated by the Greek government.
He strongly suggested that the suspension of rating requirements
for Greek debt was a vote of no-confidence by the ECB in the commercial
rating agencies and the private market agents that hang on their every
word.
He also said that liquidity problems in the Greek banking sector,
which had escalated sharply in recent days, should be resolved now that
the new austerity measures are in place and have been given a seal of
approval by the ECB and the European Commission.
With regard to the decision to suspend minimum rating criteria,
“Greece is the only country for which this specific issue was raised for
discussion, and it was raised within the framework of evaluating the
budget consolidation program as a whole,” Orphanides said.
He added: “The decision was taken on the basis of additional
information the ECB received on the Greek economy and its [future]
course. Based on this information, the ECB decided to suspend the
minimum rating threshold and suspend the criteria being put forward by
commercial institutions that have less information than the ECB.”
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