ECB Restores Greek Banks' Ability To Tap Cheap Funding

European Central Bank policy makers on Wednesday reinstated a waiver that will allow Greek banks to again participate in cheap funding operations. Greek banks will again be able to use debt guaranteed by the country's government as collateral in the funding operations. The decision was widely expected after eurozone finance ministers last month reached a deal with the International Monetary Fund that allowed the release of bailout funds to Athens. For more than a year, Greek banks had to rely on more expensive funding via the Greek central bank after the ECB revoked the waiver amid a dispute between the Athens and its creditors over austerity measures. Greek government debt however, remains ineligible for purchase as part of the ECB's bond-buying program. The ECB said it would examine possible purchases of Greek government bonds under that program at a later stage, "taking into account the progress made in the analysis and reinforcement of Greece's debt sustainability, as well as other risk management considerations."