Bailout tranche re­ceived, ECB paid

Kathimerini English - - Focus -

The Euro­pean Cen­tral Bank yesterday re­ceived a 3.2-bil­lion-euro debt re­pay­ment from Greece, mark­ing the ful­fill­ment of Athens’s last sig­nif­i­cant obli­ga­tion to­ward the ECB for the next 11 months.

“The ECB con­firms that all Greek gov­ern­ment bonds ma­tur­ing to­day and owed to the ECB and Eurosys­tem na­tional cen­tral bank have been re­paid by Greece,” the bank said.

Greece used bailout funds re­leased ear­lier in the day to re­pay the bonds, held by the ECB and na­tional cen­tral banks of eu­ro­zone coun­tries. Greece’s next siz­able bond re­pay­ment to the ECB falls due in July 2016.

Athens re­paid the debt us­ing money from the first in­stall­ment of its new bailout af­ter the pro­gram cleared its fi­nal hur­dle on Wed­nes­day night, with the Euro­pean Sta­bil­ity Mech­a­nism ap- prov­ing the 86-bil­lion-euro deal.

The aid deal comes af­ter months of ne­go­ti­a­tions be­tween Greece and its cred­i­tors that saw the coun­try flirt­ing with an exit from the euro area. Law­mak­ers in Ger­many and the Nether­lands signed off on the plan Wed­nes­day, af­ter Ger­man Chan­cel­lor An­gela Merkel and Dutch Prime Min­is­ter Mark Rutte fought off do­mes­tic op­po­si­tion to push the bailout through.

The ESM trans­ferred a first tranche of about 13 bil­lion eu­ros out of the 86-bil­lion-euro pro­gram, the Brus­sels-based cri­sis fund said in state­ment.

The gov­ern­ment will have about 1 bil­lion eu­ros of that first trans­fer avail­able to shore up public fi­nances af­ter the rest is set aside for debt ser­vic­ing and re­pay­ment of a 7.2-bil­lion-euro bridge loan granted in July, the Fi­nance Min­istry said in a state­ment late Wed­nes­day.

Another 10 bil­lion eu­ros will go into a seg­re­gated ESM ac­count that is avail­able for bank re­cap­i­tal­iza­tion.

The ECB’s bank­ing su­per­vi­sion chair, Daniele Nouy, said yesterday that Greek banks will re­cover from the cur­rent cri­sis be­cause they en­tered the tur­bu­lence rel­a­tively strong thanks to ear­lier re­form ef­forts.

“Po­lit­i­cal events have of course weak­ened the banks, but the cri­sis did not start from the banks,” Nouy told Fin­nish broad­caster YLE. “I’m op­ti­mistic that the banks will re­cover be­cause they have done so be­fore.”

Greece’s banks were al­lo­cated a to­tal of 25 bil­lion eu­ros in the bailout but will not re­ceive the new cap­i­tal un­til author­i­ties com­plete their stress tests in Oc­to­ber.

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