ECB could re­in­state waiver be­fore Oc­to­ber

Kathimerini English - - Front Page -

The Euro­pean Cen­tral Bank could re­store nor­mal fund­ing lines for Greek banks by Oc­to­ber, Ex­ec­u­tive Board mem­ber Benoit Coeure said. Greek lenders have re­lied on emer­gency liq­uid­ity as­sis­tance from their own cen­tral bank since Fe­bru­ary. Greece’s new bailout is sched­uled to be re­viewed in Oc­to­ber. “We could po­ten­tially act ear­lier,” Coeure said in an in­ter­view with Ger­many’s Bo­ersen-Zeitung pub­lished on the ECB’s web­site on Fri­day. “Greece’s new pro­gram con­tains a large num­ber of ‘prior ac­tions.’ The ques­tion for the Gov­ern­ing Coun­cil will be whether these pre­lim­i­nary mea­sures are suf­fi­cient to meet our cri­te­ria.” Coeure said the Gov­ern­ing Coun­cil has not yet dis­cussed the waiver. Its next sched­uled pol­icy meet­ing is for Septem­ber 3. Coeure also said Greek banks should be re­cap­i­tal­ized as soon as pos­si­ble un­der the new aid pro­gram, which in­cludes as much as 25 bil­lion eu­ros for the pur­pose, though only af­ter the fi­nan­cial in­sti­tu­tions are checked. The ECB’s bank su­per­vi­sors have started a new as­set qual­ity re­view and stress test for Greece’s four ma­jor banks. “Those credit in­sti­tu­tions were ad­e­quately cap­i­tal­ized but they are now op­er­at­ing in an ex­tremely dif­fi­cult eco­nomic en­vi­ron­ment, and non­per­form­ing loans are likely to in­crease in the next few years,” he said. “The bank­ing su­per­vi­sors will need a few weeks to con­clude their as­sess­ment. For that rea­son, the re­cap­i­tal­iza­tion should not take place im­me­di­ately. But it should hap­pen be­fore the end of the year.”

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