Breaking new title at wsj
http://asia.wsj.com/home-page?refresh=on

That's means they're in good shape right? What could go wrong? Glad they finally fixed it.

I seem to recall that this action was leaked or well-anticipated. Anyway, here's the fresh ECB Release:

http://www.ecb.int/press/pr/date/2012/ht....

Quote:

PRESS RELEASE

22 June 2012 - ECB takes further measures to increase collateral availability for counterparties

On 20 June 2012 the Governing Council of the European Central Bank (ECB) decided on additional measures to improve the access of the banking sector to Eurosystem operations in order to further support the provision of credit to households and non-financial corporations.

The Governing Council has reduced the rating threshold and amended the eligibility requirements for certain asset-backed securities (ABSs). It has thus broadened the scope of the measures to increase collateral availability which were introduced on 8 December 2011 and which remain applicable.

In addition to the ABSs that are already eligible for use as collateral in Eurosystem operations, the Eurosystem will consider the following ABSs as eligible:

1.Auto loan, leasing and consumer finance ABSs and ABSs backed by commercial mortgages (CMBSs) which have a second-best rating of at least “single A” [1] in the Eurosystem’s harmonised credit scale, at issuance and at all times subsequently. These ABSs will be subject to a valuation haircut of 16%.

2.Residential mortgage-backed securities (RMBSs), securities backed by loans to small and medium-sized enterprises (SMEs), auto loan, leasing and consumer finance ABSs and CMBSs which have a second-best rating of at least “triple B” [2] in the Eurosystem’s harmonised credit scale, at issuance and at all times subsequently. RMBSs, securities backed by loans to SMEs, and auto loan, leasing and consumer finance ABSs would be subject to a valuation haircut of 26%, while CMBSs would be subject to a valuation haircut of 32%.

The risk control framework with higher haircuts applicable to the newly eligible ABS aims at ensuring risk equalisation across asset classes and maintaining the risk profile of the Eurosystem.

The newly eligible ABSs must also satisfy additional requirements which will be specified in the legal act to be adopted Thursday, 28 June 2012. The measures will take effect as soon as the relevant legal act enters into force.



--------------------------------------------------------------------------------

[1]A “single-A” rating is a rating of at least A3 from Moody’s, A- from Fitch or Standard & Poor’s, or AL from DBRS.

[2]A “triple-B” rating is a rating of at least Baa3 from Moody’s, BBB- from Fitch or Standard & Poor’s, or BBB from DBRS.

More used toilet paper.

So Basel II just got hosed

No wonder Piggy bonds have been getting snatched up like hot cakes.

Investors will spike Spain and Italy's bond yields forcing the ECB to come in and buy bonds to force down the rates. They will then sell them to the ECB.

Do they publish the rules?

What rules? It's Calvinball.

It's almost closing time and the ECB has gone from hitting on the fat chicks to hitting on the ugly fat chicks.

Hey Angela, looks like you have a chance to get some at the ECB, mein fraulein!

From another thread:

Keep in mind that in late 09 the ECB publicly stated that they were not aware of what the value of the collateral they had was. They have, since then, stated at least twice and I think three different times that they were lowering their standards on collateral.

Several iterations ago, they were taking any piece of paper with dog **** smeared on it as collateral. I honestly don't think they have even bothered to care *AT ALL* for years.