The Governor of the Bank of Slovenia Boštjan Jazbec told the German newspaper Handelsblatt that Greek banks do not face any liquidity problems at the moment. According to Mr. Jazbec the ELA, from which Greek banks are drawing funds from after the ECB’s decision, reevaluates its decisions every two weeks. At present, Mr. Jazbec noted, Greek banks are not in danger.
When asked about the possibility of the ECB cutting off funding from the ELA, the Slovenian central banker responded that it was important to monitor the situation and expressed his belief that the Greek banks would do all they can to avoid such a threat.
As of today the European Central Bank has stopped accepting Greek titles as collateral, forcing the Greek government to resort to the Emergency Liquidity Assistance mechanism for funding.
The ELA can provide up to 60 billion euros, however it may increase its credit, after consultation and approval by the board of the ECB. In order for the ECB to approve this, it would have to consider the banks to be creditworthy, highlighting the importance of Mr. Jazbec’s comment.
