Greece emergency funding on ECB agenda this week: source

10th March 2015, Comments 0 comments

The European Central Bank will again examine whether to extend emergency funding to Greek banks at a meeting this week, a source familiar with the ECB's thinking on the matter told AFP on Tuesday.

The ECB's policy-setting governing council was likely to discuss the issue in a teleconference on Thursday, the source said.

"They will discuss it to review and possibly extend the ELA (emergency liquidity assistance). It should take place on Thursday," the source said.

A spokesman for the ECB declined to comment.

Greek banks are dependent on the ECB for financing, but the eurozone's central bank no longer accepts Greek sovereign bonds as collateral for loans.

It had done so previously under a special waiver mechanism, but rescinded that waiver until Athens' new anti-austerity government under Prime Minister Alexis Tsipras can reach a new debt deal with its creditors.

Without the waiver, Greek banks now rely solely on ELA, which is more expensive than normal central bank refinancing operations.

At a meeting in Nicosia last week, the governing council decided to raise the ELA ceiling by 500 million euros to 68.8 billion euros ($73.3 billion).

Given the changing situation in Greece, the ECB has now decided to closely monitor the country's liquidity situation, and will probably hold a meeting each week on the ELA facility, the source said.

© 2015 AFP

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