ECB emergency funding to Greek banks unchanged until Wednesday – Il Sole 24 Ore

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This article was published June 29, 2015 at 13:47.

FRANKFURT – The European Central Bank will maintain the liquidity of emergency (Ela) for Greek banks to the current level of 89 billion euro until Wednesday, when the Board will meet to discuss the case thoroughly Greece, as stated this morning the president of the Austrian Central Bank, Ewald Nowotny. In a statement released Sunday, the ECB had however stated that it is ready to review its decision (which confirmed the level of Ela previous four days) at any time.

In fact, Ela funds are sold out, after the massive outflow of deposits that followed the announcement on Friday night by the premier greek Alexis Tsipras want to hold a referendum next Sunday on the proposals of creditors, which has forced authorities in Athens the closure of banks and the introduction of capital controls. The ECB does not want to take responsibility to pull the plug on Greece and it will probably only if the breakdown of the relationship between Athens and the rest of the eurozone would become irreversible.

Nowotny argued that “the ball is in the field of Greece” and said he was convinced that the majority of Greeks want to stay in the euro and that this could be the basis for a resumption of negotiations, but that ” there are many uncertainties. “
Barring unforeseen circumstances, always possible in a story that has reserved many, it is likely that the ECB wants to wait to pass the deadline tomorrow, when the decade program between Greece and creditors, which was was extended to the end of February until the end of June in fact, and when Athens should repay about EUR 1.6 billion to the IMF, which currently appears to be almost ruled out.

Meanwhile, to limit the effects of contagion, the ECB continues to operate in the markets, where it is already buying government bonds of eurozone countries to the tune of 60 billion Euros per month depending on the plan Quantitative easing (Qe) announced in January last year and launched in March. In recent weeks, the Institute of Frankfurt warned you want to speed up purchases before the summer reduction in volumes in the markets, an attitude that can come in very handy now to stabilize prices in the presence of strong sales of investors due to the increase of ‘uncertainty about the Greek case. The bulk of the purchases are made through the national central banks that are part of the Eurosystem.

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