Euro Area Watch: Key dates ahead for Greece

A missed payment by Greece on 30 June would be crucial. It could not be ignored by the ECB and would have drastic consequences on ELA. Not repaying the ECB on 20 July would be the last straw. It would be a forced transfer to Greece from European taxpayers.

BofA Merrill Lynch provides a tentative timeline on the Greek issues until 20 July:

Wednesday 17 June 10.00 GMT: Press briefing by the President of the Euro Working Group 

Since the Greek government announced today that they would not transmit any new proposal to the European authorities ahead of the Eurogroup, the Euro Working Group (EWG) won't have much to look into. They could however work on a "last ditch" proposition from the European side to Athens, as well as on any contingency plan in case of non-agreement. 

Wednesday 17 June : T-bills refinancing (results normally out at 10.20 GMT) 

Greece has EUR 1.6bn to refinance. This is now entirely done by Greek accounts rolling over their exposure. Now that residents no longer have to cover the share of leaving non-residents, Greek banks no longer need ELA extension to fund this.  

Wednesday 17 June (probably): ECB reviews ELA 

This week already there will likely be voices within the Governing Council in favour of "freezing" the amount of ELA. However, our reading of Draghi's hearing at the European parliament yesterday is that the central bank does not want to be seen as playing a political role, which it could be seen as doing by making drastic decisions before the Eurogroup meeting and ahead of any Greek failure to face their financial commitments. We thus do not expect such hardline position to gather the requested 2/3 of the votes within the Council. Raising the haircuts, which would not immediately stop the flow of liquidity but clearly signal the ECB's limited reserve of patience could be a compromise solution.  

Thursday 18 June: Eurogroup meeting (finance ministers level)

This could be the occasion for the Europeans to present Athens with a "take it or leave it plan". We would probably start hearing from this only very late in the night, and in any case we would not expect the Greek government to respond immediately (and if they were to accept, they would still have to get the OK from their parliament).

Friday 19 June: coupon payment to the ECB on their GGB holdings

It is only EUR85mn, so we are confident the Greek government has the money. It would be a very bad signal if that payment was missed.

Wednesday 24 June (likely): ECB reviews ELA

Thursday 25 June and Friday 26 June: European summit (heads of government level)

Very, very last chance to get a political deal on Greece - but it would probably be much too late to get anything disbursed by 30 June given the need to get the parliaments involved.

Tuesday 30 June: deadline for bundled payment to the IMF and expiry of the Greek programme (EUR 1.6bn)

There is an uncertainty on whether or not Greece could benefit from a 30 day "grace period" if it misses the 30 June deadline. In our view, given the focus on this issue, it would be very hard for Christine Lagarde and the board to turn a blind eye.

Wednesday 1 July (probably): first post-IMF payment ECB decision on ELA

This is crucial moment. True, S&P stated that they would not consider such missed-payment to constitute a default - so it is unclear if the ECB could immediately derive from this that the Greek banks are insolvent (a key condition for the continuation of ELA). 

Monday 6 July: Bundestag is in recess

It would still be possible to recall parliament if a deal was struck, but with a higher political cost to Merkel.

Wednesday 8 July: T-bills auction

Wednesday 15 July: T-bills auction

Monday 20 July: Payment to the ECB (coupons EUR 700mn and principal 3.5bn)

This is for us the final deadline. Not paying the ECB would basically mean forcing a transfer from European taxpayers to Greece (at the very least because the ECB will pay less income to the governments to cover the loss). It would then be very difficult to repair the relationship between Athens and the Europeans, at least under the current political configuration in Greece.