ECB Stops Monetary Policy Operations To Some Greek Banks

Tyler Durden's picture


Update: some additional color from MNI, as Europe scrambles for damage control:

The European Financial Stability Facility (EFSF) is expected to approve an E18 billion recapitalization disbursement for Greek banks within the next four days, and the banks should get the money within a week, a senior Eurozone official told MNI Wednesda.


Earlier today MNI reported that the European Central Bank was growing nervous about delays in the recapitalization program for Greece and was threatening to suspend its lending to Greek banks as a means of expediting the decision.


"This has been a point of concern for the last month, and it was debated during Monday's Eurogroup meeting, where ECB President Mario Draghi and EFSF head Klaus Regling were present," the official said. "Up until then, the EFSF had sided with the Greek Financial Stability Fund, which was delaying the recapitalization process because it disagreed with certain points of the assessment of Greek banks' eligibility for the funds," he explained.

Just as we predicted moments ago, and as Dutch Dagblad warned overnight:


From Reuters:

The European Central Bank has stopped monetary policy operations with some Greek banks as they have not been successfully recapitalized, euro zone central bank sources said on Wednesday.


The ECB declined to comment.


The ECB only conducts its refinancing operations with solvent banks. With no access to ECB funds, the banks concerned must go to the Bank of Greece for emergency liquidity assistance (ELA).


It was unclear exactly how many banks were affected.


One person familiar with the matter said four Greek banks' capital was so depleted they were operating with negative equity capital. According to its own rules, the ECB cannot provide liquidity to banks in such a situation.

The beginning of the end? Or just more political posturing? In the meantime, EURUSD tumbles.

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Wed, 05/16/2012 - 11:10 | 2431491 Dumpster Fire
Dumpster Fire's picture

Definitely picked a bad week to quit sniffing glue.

Wed, 05/16/2012 - 11:12 | 2431512 CvlDobd
CvlDobd's picture

Shit's getting ugly! Gonna need more lipstick!


Wed, 05/16/2012 - 11:13 | 2431524 GetZeeGold
GetZeeGold's picture



Heh heh....please stop the car....I think I'm gonna hurl.


Wed, 05/16/2012 - 11:20 | 2431555 Bleeding Fart
Bleeding Fart's picture

Would going to Europe this summer be a bad idea? Gold is too heavy too carry. How about some precious gems? (The first half of my question is serious.)

Wed, 05/16/2012 - 11:32 | 2431604 crawldaddy
crawldaddy's picture

for awhile the USD, is goona be strong and buy alot fo stuff.  Enjoy it while we can.

Wed, 05/16/2012 - 12:06 | 2431710 FlyoverCountryS...
FlyoverCountrySchmuck's picture

"A While..." being until January 1, 2013, when TAXMAGEDDON hits.

•The individual income tax rates will rise to 15%, 28%, 31%, 36% and 39.6%.
•The long-term capital gains will be taxed at a maximum rate of 20%.
•Dividends will be taxed as ordinary income.
•The phase-out of personal exemptions for higher-income taxpayers will be reinstated.
•The limit on itemized deductions will be restored.
•The child tax credit, adoption credit, and dependent care tax credit will all be cut back.
•The “marriage penalty” will be restored.
•Education incentives will disappear altogether, or be significantly cut back.
•The elevated estate tax exemption of over $5 million is scheduled to fall to $1 million, and the top rate will revert to 55% from 35%.
•The alternative minimum tax (ATM) patch which increased the amounts exempted from this tax will reset to lower amounts, subjecting a larger group of middle income taxpayers to the AMT.

Wed, 05/16/2012 - 12:46 | 2431906 DosZap
DosZap's picture


Will it stop Illegals from filing IRS 1040's, and claiming nieces and nephews as dependents(who LIVE in Mexico), and gettig $26,000 back from the IRS?.

In just one instance four illegals used one legals address, claimed 20 dependents(not dependents,in Mexico), and together got back around $40k in OUR tax dollars..........using fake SS #'s and address, and fake dependents.

The HEAD of the IRS knows this is going on, and refuses to speak to the issue......................thus far, in 3yrs, its cost US Taxpayers well over 4 Billion dollar in fake returns.

AND not one soul in the IRS gives a shit.

So, wtf are we still filing at all?

Wed, 05/16/2012 - 14:12 | 2432360 Nobody For President
Nobody For President's picture

In other words, we will be back to the days when this country ran budget surpluses, and the debt was getting paid down. What a terrible idea! I managed to survive and prosper during those days, somehow I don't think this is gonna kill me, though it will effect my income enough to notice. So fucking what?

We need to cut spending, yes. Lots of it. But the taxes also have to revert to 1998-ish levels, or we will face a true financial armageddon - this taxmaggedon bullshit is the rich crying wolf, again. If all these things were to happen, i.e. reversion to levels of 'the good ole days'; the world will not end. Never happen, our craven, bought and sold congress will make sure we continue along the path the total, complete debt serfdom.

Cuts AND taxes, biltchz! Or does math not apply to fiscal policy?

Wed, 05/16/2012 - 11:33 | 2431605 Arius
Arius's picture

no, i think is a very good idea ... you might find some good bargains.  i went through athens airport a couple of days ago, never seen so many americans coming through .... 

Wed, 05/16/2012 - 11:47 | 2431606 hedgeless_horseman
hedgeless_horseman's picture



Want to pay for that trip?

Tenet Healtcare THC down another 2%. 


Selling MOBs isn't sustainable growth.

Air pockets below, so put your tray table up, seat fully forward, and buckle up, bitchezzz.

Reserve a center-balcony table for me at Le Grill at Hotel de Paris.  8pm then we'll hit the tables.

Wed, 05/16/2012 - 11:58 | 2431687 He_Who Carried ...
He_Who Carried The Sun's picture

Greece leaving the Euro

is actually a great thing and very bullish to the Euro.

Time to go shopping, Guys.... :-))

Wed, 05/16/2012 - 12:01 | 2431695 hedgeless_horseman
hedgeless_horseman's picture



...and so Spain leaving would be XX Mucho Bullish?

Wed, 05/16/2012 - 11:36 | 2431626 RoadKill
RoadKill's picture

Should be a great time to visit Santorini cost wise. And people there are older and more relaxed. But Id avoid Athrns and all the party islands like Mykinos or Ios and the big tourist ilse of Crete. To many young people there.

Spain will be a mess. It will suck if these asshole rioters ruin Barcelona and Madrid. Beautiful cities. Pamplona will probably Devolve into out right rioting. Major cities in Italy will also be risky. We ran into more protestors and violence in Rome and Florence then anywhere else in Europe (we were in Europe for 2 months last summer durimg all this). The French and Italian Rivereas will be fine as always.

Id tell you to avoid big cities. Do like Cannes, Nice, Theoule, Monte Carlo, Italian Riviera (cinqa terra). Switzerland, Austria and Luxemborg. MAYBE Bennelux (not sure).

Wed, 05/16/2012 - 12:32 | 2431820 indygo55
indygo55's picture

I'm going in a few weeks with my 16 year old son. Feeling a little queezy right now. 

Wed, 05/16/2012 - 13:00 | 2431981 pods
pods's picture

Rumor has it that Louk lives up to his name. Bring along some chorizo and you will be fine.

Wed, 05/16/2012 - 11:16 | 2431527 Alea Iactaest
Alea Iactaest's picture

Only a matter of time until 1.27 is in the rear view mirror...





Edit: Well, we got 1.268 followed by a stick save.

Wed, 05/16/2012 - 11:28 | 2431588 bdc63
bdc63's picture

WWZD (what would Zeus do)?

Wed, 05/16/2012 - 11:14 | 2431531 ihedgemyhedges
ihedgemyhedges's picture


Wed, 05/16/2012 - 11:19 | 2431551 mayhem_korner
mayhem_korner's picture



A 6 Euro (Drachma?) Gyro is going to be a 20 Euro Gyro once the plebes empty all the ATMs at the first bank of Olives.

Wed, 05/16/2012 - 12:56 | 2431959 Carl Spackler
Carl Spackler's picture

Send the Repo Men to grab the Acropolis.


Wed, 05/16/2012 - 13:09 | 2432020 NotApplicable
NotApplicable's picture

Soros likely holds the title already (via NGO proxy, of course). Like all other holders, he's just going to sit back and let the "political process" work it's magic in diminishing the strength of the opposition.

At least that's what I'd do if I were a billionaire "philanthropist."

Wed, 05/16/2012 - 11:29 | 2431589 King_Julian
Wed, 05/16/2012 - 11:41 | 2431638 Shleprock
Shleprock's picture

I'm still sniifin ... double nostril Bro!

Wed, 05/16/2012 - 12:01 | 2431703 jus_lite_reading
jus_lite_reading's picture


Hearing rumors that 50 Euro limit on ATM withdrawls now in effect in central Athens and surrounding areas!!

Anyone else hear this?

Wed, 05/16/2012 - 12:11 | 2431737 Marginal Call
Marginal Call's picture

Rumors have had the ATMS empty for days.

Wed, 05/16/2012 - 13:09 | 2432027 NotApplicable
NotApplicable's picture

But what's the limit on Drachmas?

Wed, 05/16/2012 - 11:08 | 2431492 ebworthen
ebworthen's picture

Can't happen soon enough.

Wed, 05/16/2012 - 13:09 | 2432016 machineh
machineh's picture

'The ECB only conducts its refinancing operations with solvent banks.'


I am shocked ... SHOCKED ... to learn that some insolvent banks may have attempted to put taxpayers' money at risk!

Wed, 05/16/2012 - 11:08 | 2431493 Brak82
Brak82's picture

The beginning, bitches!

Wed, 05/16/2012 - 11:34 | 2431620 bdc63
bdc63's picture

the beginning?! ... I thought we were at least at the 7th inning stretch ...

Wed, 05/16/2012 - 12:00 | 2431698 FlyoverCountryS...
FlyoverCountrySchmuck's picture

It's the end of the beginning. What happens from here on out is anybody's guess.


But hey, those 30% 10-yr bonds are a NO BRAINER, right JPM?

Wed, 05/16/2012 - 11:10 | 2431494 Yikes
Yikes's picture

US markets rolling over.

Wed, 05/16/2012 - 11:14 | 2431518 fonzannoon
fonzannoon's picture

and rolling back

Wed, 05/16/2012 - 11:17 | 2431539 catacl1sm
catacl1sm's picture

Wow, that was fast. Some had their finger on the 'buy' trigger.

Wed, 05/16/2012 - 11:29 | 2431564 VonManstein
VonManstein's picture


hahah "rolling over" less than 0.10 %

(ok i spoke too soon)

Wed, 05/16/2012 - 11:23 | 2431569 Yikes
Yikes's picture

aaaand back down again.  Could be crazy day. 

Wed, 05/16/2012 - 13:12 | 2432035 NotApplicable
NotApplicable's picture

Battle Bots, FTMFW!

Wed, 05/16/2012 - 14:23 | 2432431 Nobody For President
Nobody For President's picture

Could be?



Roller coaster, bitcheezzzzzz


(Forgive me, I'm ON today and making money hand over fist. Tomorrow I'll probably get creamed...)


Wed, 05/16/2012 - 11:10 | 2431497 junkyardjack
junkyardjack's picture

I was wondering what brick wall the market just smashed into...

Wed, 05/16/2012 - 11:13 | 2431525 navy62802
navy62802's picture

It's called reality.

But no worries, looks like we have a V-shaped recovery in the Dow at least. Haha.

Wed, 05/16/2012 - 11:11 | 2431499 Killtruck
Killtruck's picture

This is bullish...right? Right?

I KNEW it.

Wed, 05/16/2012 - 11:15 | 2431537 SMG
SMG's picture


Wed, 05/16/2012 - 11:11 | 2431501 Slope of Hope
Slope of Hope's picture

I recently got ripped by some Europeans because our currency is all the same color.  How do you like us now?

Wed, 05/16/2012 - 11:19 | 2431543 mayhem_korner
mayhem_korner's picture



They're just ticked 'cause they don't have the contract on the bazillion gallons of toner that's gonna be needed.

Wed, 05/16/2012 - 11:30 | 2431599 aerojet
aerojet's picture

If you're talking about US FR notes, that isn't the case anymore--the $10 bill is freaking purple!  The $5 note is looking a bit unhealthy red, too. 

Wed, 05/16/2012 - 12:27 | 2431805 tarsubil
tarsubil's picture


It is a little enhanced but I think the joke is on US.

Wed, 05/16/2012 - 11:11 | 2431502 surf0766
surf0766's picture

The beginning of the end of Greece or of Euro or of both?

Wed, 05/16/2012 - 11:14 | 2431532 mayhem_korner
mayhem_korner's picture




Wed, 05/16/2012 - 11:22 | 2431568 saturn
saturn's picture

the euro machine will soon stop working completely if there is nothing to greece it with..

Wed, 05/16/2012 - 13:27 | 2432123 viahj
viahj's picture

Euro bank solvency will stop if there is no Greece through which to funnel fiat from the ECB, et al. to the banks

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