Greek banks' solvency not at risk: ECB council member

11th February 2015, Comments 0 comments

Greek banks are not currently at risk of running out of money, a member of the European Central Bank's decision-making governing council said in an interview published Wednesday.

"At the moment, the solvency is Greek banks is not at risk," Bostjan Jazbec, the head of Slovenia's central bank, told the German business daily Handelsblatt.

The ECB last week said it would restrict Greek banks' access to a key channel of financing by refusing to accept Greek sovereign bonds as loan collateral.

But a day later, it also gave a green light to the provision of emergency liquidity assistance (ELA) to any Greek bank that needs it.

One central bank source told AFP that the ECB had approved the provision of up to 60 billion euros ($68 billion) in ELA funds.

The ELA facility was set up precisely to help banks suffering from temporary liquidity problems. And other countries' banks had benefitted from ELA in the past, Jazbec noted.

Asked whether there was a risk that the ECB might also switch off the ELA channel of funding for Greek banks, Jazbec replied: "There is always a danger of this."

But he said: "It is therefore crucial that this be monitored closely. I'm convinced that the Greek banks and the Greek central bank will do everything to ward off any dangers for the financial system."

© 2015 AFP

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