Excerpts from Interview with Claudia Buch (Deputy President of the Deutsche Bundesbank) published in WirtschaftsWoche on 9 February 2015
"The financial system is now more crisis-proof, too – especially thanks to better capitalization and new institutions such as the European Stability Mechanism (ESM). But still, contagion effects are naturally impossible to rule out altogether."
....
"Greece has already had its debt restructured and benefited from debt relief. The country’s problems are primarily of a structural nature and require a clear commitment to reforms. However, the debate on haircuts is creating added uncertainty. That is why I find it unhelpful."
...
"At its last meeting, the Governing Council of the ECB decided to lift the waiver affecting Greek government bonds as of 11 February. These bonds will therefore no longer be eligible as collateral for regular monetary policy operations. However, Greek banks will retain access to central bank liquidity; their counterparty status is unchanged. Should banks not have sufficient regular collateral at their disposal, their additional liquidity needs can be covered by emergency liquidity assistance (ELA) through the Bank of Greece. This is governed by clear rules, however."
Without any risk or responsibility
"The financial system is now more crisis-proof, too – especially thanks to better capitalization and new institutions such as the European Stability Mechanism (ESM). But still, contagion effects are naturally impossible to rule out altogether."
....
"Greece has already had its debt restructured and benefited from debt relief. The country’s problems are primarily of a structural nature and require a clear commitment to reforms. However, the debate on haircuts is creating added uncertainty. That is why I find it unhelpful."
...
"At its last meeting, the Governing Council of the ECB decided to lift the waiver affecting Greek government bonds as of 11 February. These bonds will therefore no longer be eligible as collateral for regular monetary policy operations. However, Greek banks will retain access to central bank liquidity; their counterparty status is unchanged. Should banks not have sufficient regular collateral at their disposal, their additional liquidity needs can be covered by emergency liquidity assistance (ELA) through the Bank of Greece. This is governed by clear rules, however."
Without any risk or responsibility
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