BUSINESS

ECB said to raise emergency Greek bank aid to near $100 billion

By Christos Ziotis & Alessandro Speciale

The European Central Bank raised emergency funding for Greek lenders for the third time in less than a week, people familiar with the decision said.

The Governing Council increased the cap on Emergency Liquidity Assistance to 87.8 billion euros ($99.8 billion) in a telephone conference on Monday, and another review will take place within 24 hours, the people said, asking not to be named as the call was private. The limit was increased by 1.1 billion euros to 84.1 billion euros on Wednesday, and by a further 1.8 billion euros on Friday. An ECB spokesman declined to comment.

The decision to review ELA so frequently is a signal to Greece that its situation is serious, a European Union official said last week. Euro-area finance ministers met in Brussels on Monday before an emergency summit of European leaders, as concern rises that talks on Greece’s bailout program will fail to avert a government default.

ECB President Mario Draghi said last week that liquidity will be extended to Greek banks as long as they are solvent and have sufficient collateral. He also said the central bank is monitoring closely to see if those conditions change.

Draghi will meet Greek Prime Minister Alexis Tsipras at 6 p.m. in Brussels, according to an e-mailed statement by Tsipras’s office.

Dutch Finance Minister Jeroen Dijsselbloem, who chairs meetings of his euro-area counterparts, said a new set of proposals submitted by the Greek government formed the basis for a potential deal to end a standoff over aid.

The reform measures were communicated to creditors earlier on Monday, Dijsselbloem told reporters in Brussels after the meeting of finance chiefs. While they came too late for a thorough appraisal, the proposals are seen as a positive step, he said.

[Bloomberg]

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