They will now for colateral purposes accept their impaired bonds at face value.
ECB Trichet: To Suspend Collateral Rules For Portugal
FRANKFURT (MNI) – The European Central Bank has decided to suspend
the minimum collateral requirements for Portugal, ECB President
Jean-Claude Trichet said Thursday.
Trichet said that the central bank had taken this decision in light
of the EU/IMF adjustment program in Portugal. The move follows rating
agency Moody’s decision to downgrade Portuguese government debt to junk
status earlier this week.
The central bank already dropped the rating floor for Greek
government bonds last year. However, Trichet reiterated that the central
bank maintains its position that it will not take Greek debt in its
refis should they be rated as default.
“We say ‘No’ to selective default. Full stop,” Trichet said.
