ECB Could Still Take Greek Collateral After Default, RBS Says

The European Central Bank could still accept collateral from Greek banks for loans in the event the nation restructures debt, contrary to suggestions by Executive Board member Juergen Stark, Royal Bank of Scotland Plc said.

According to ECB rules, any decision on whether to accept Greek government bonds as collateral from the nation’s banks to obtain ECB funding seems to be “largely discretionary and there is no automatic legal constraint,” Jacques Cailloux, chief euro-region economist for RBS in London, said in an e-mailed note today.