ECB: Subdued reaction to reinstate the waiver for the use of Greek sovereign bonds - BBH

Research Team at BBH, notes that there has been a rather subdued reaction to the ECB's decision to reinstate the waiver for the use of Greek sovereign bonds for collateral. 

Key Quotes

“Recall that early last year, as Greece lurched without a program, the ECB stopped accepting Greek bonds as collateral.  This forced the Greek banks to rely on more expensive emergency lending by the central bank of Greece. 

Greek bond yields are lower, but at 7.67%, the 10-year yield, for example, has not made new lows in the week. Nor are Greek equities outperforming. However, the shift back to borrowing from the ECB is a positive development for Greek banks.  Financials are leading the Athens Stock Exchange Higher with a 2.3% gain today.  Overall, European financials are market performers today, matching the 1.4% gains of the Dow Jones Stoxx 600.”