European Central Bank keeps Greek liquidity assistance unchanged

“Banking shares are the ones we have the most doubts about”, said Konstantinos Botopoulos, head of the Greek financial markets commission.


Greek banks have seen billions of euros flow out of accounts this year as the potential for Greece being thrown out of the euro zone grew.

Greece is feverishly negotiating with creditors on a deal that would unlock bailout funds by August 20, when it must repay some 3.4 billion euros due to the European Central Bank.

“They (the creditors) also agree that there must not be a haircut on bank deposits”, Tsakalotos said. Consequently, there was no option but to impose capital controls and close banks. Greek banks have been falling sharply since Monday when the stock market reopened after a five-week shutdown.

The restrictions were eased July 20, but withdrawals and money transfers overseas remain limited.

Government spokeswoman Olga Gerovassili said initial talks finished on Tuesday and would shift Wednesday to a “second phase” in which the two sides would begin actually drafting the accord.

Corporate loans will come under the scrutiny of the Asset Quality Review, with the European experts assessing a broad sample of some 1,000 loans per bank.

During the months-long crisis, ELA has kept ailing Greek banks afloat, and by extension prevented the Greek economy from sinking.


Greece registered record dismal manufacturing data in July, with the latest purchasing managers’ index (PMI) falling to 30.2.

Greek stock exchange