The funding access would be a big step in stabilizing the Greek banking system and normalizing an economy still in recession, also dealing with capital controls and austerity reforms related to its third bailout since 2010 worth up to 86 billion euros.
 
Greek banks lost their access to the ECB's regular funding operations early last year during negotiations with the country’s international lenders.
 
With economic contraction for most of the past decade, Greece has lost over a quarter of its GDP since its peak in 2007 and unemployment stands at the highest rate than all Eurozone states.
 
Reuters reported that while Greece's debt is rated “junk” by credit agencies, the ECB was set to waive its minimum credit rating requirement at its Governing Council meeting on Wednesday, letting banks post government-guaranteed debt as collateral in exchange for normal funding.
 
In fact, ECB President Mario Draghi said Greece has made significant progress, qualifying for the next tranche of aid, so the ECB Governing Council would consider the issue, speaking to a European Parliament committee on Tuesday.
 
The credit requirement waiver would also be the first step to including Greece in the ECB's 1.74 trillion euro asset purchase program from which other European member states currently profit, though that will require further deliberations and a debt sustainability review.
 
The ECB's waiver does not automatically solve Greek bank's funding problems as they will still have limited eligible collateral so they can only switch a minor part of their 64.8 billion euros worth of Emergency Liquidity Assistance (ELA) to the ECB's regular funding operations. Though the exact details of ELA are not published, the average interest rate charged on it is estimated to be around 100 to 150 basis points above the ECB's main refinancing rate, currently set at 0 percent.