ECB to keep collateral rules into 2011: Trichet

PARIS: ECB president Jean-Claude Trichet said the bank will leave emergency collateral rules in place into 2011, softening his stance as Greece struggles to reduce the European Union’s largest budget deficit.

“It is the intention of the ECB’s Governing Council to keep the minimum credit threshold in the collateral framework at investment grade level (BBB-) beyond the end of 2010,” Trichet told the European Parliament on Thursday. He also said the ECB will in January introduce a “graded haircut schedule,” allowing it to charge banks more for the lower-rated collateral they submit in return for ECB loans.