Re­cap ex­ten­sion hopes dashed

Kathimerini English - - Front Page - YIAN­NIS PAPADOYIANNIS

Greek banks have been told to speed up pro­ce­dures for their re­cap­i­tal­iza­tion in or­der to meet the dead­lines of the timetable set in the bailout agree­ment the government has signed with its in­ter­na­tional cred­i­tors.

The Hel­lenic Fi­nan­cial Sta­bil­ity Fund (HFSF) sent let­ters to all four sys­temic banks last week ask­ing them to com­plete their share cap­i­tal in­creases in time, as ev­ery­thing will need to have fin­ished by end-April. The let­ters stirred things up among bank chiefs as they have ar­rived just ahead of a visit by the cred­i­tors’ rep­re­sen­ta­tives to Athens next week.

Sources say that the Hel­lenic Bank As­so­ci­a­tion has had sig­nif­i­cant con­tacts over the last few weeks with Euro­pean in­sti­tu­tions in or­der to in­form all in­volved about the state of the lo­cal credit sys­tem and the sig­nif­i­cance of the re­cap­i­tal­iza­tion. The banks’ cen­tral ar­gu­ment has been that the coun­try’s eco­nomic con­di­tions have changed con­sid­er­ably since the draft­ing of the pro­ce­dure’s timetable, so the plan­ning will need to fac­tor in th­ese changes.

The bank chiefs’ talk of the need for a change in the re­cap terms has re­port­edly dis­turbed both the government and its cred­i­tors. Two weeks ago, fol­low­ing press re­ports on the sub­ject of an ex­ten­sion to the re­cap process, Fi­nance Min­is­ter Yan­nis Stournaras in­ter­vened to note that it would not be easy to change the law con­cern­ing the banks’ re­cap­i­tal­iza­tion. He stressed that all ad­van­tages of the ex­ist­ing agree­ment should be used. The let­ters sent by the HFSF only served to re­mind banks of their obli­ga­tions, fund sources said.

Eurobank and Pi­raeus were told to speed up their re­cap­i­tal­iza­tions.

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