By Yiannis Papadoyiannis
The Bank of Greece is set to announce the capital requirements of local banks by the end of this week or next week at the latest, as they have been determined by the BlackRock stress tests conducted late last year. It will also present the methodology used in the exercise, according to BoG sources.
A report in the Financial Times on Monday claiming that the International Monetary Fund estimates the sector’s needs as high as 20 billion euros sent shockwaves through Athens, but BoG sources insisted that the capital requirements will range between 5 and 6 billion euros. They added that these figures have been determined by the BlackRock tests and said that the method used has been checked by two more independent consultants, Rothschild and Ernst & Young.
The same sources stressed that the capital needs have not arisen from a unilateral calculation by the central bank; being the national regulatory authority, the Bank of Greece could not consent to capital needs that are not based on real data. They added that the publication of the report in detail and of the methodology applied will allow open scrutiny of the procedure.
They went on to blame the confusion on the IMF sources, noting that the Fund has been adequately informed in due time of the methodology used and the way the capital requirements were calculated and has not questioned the process.
Commercial bank officials attributed the report about the capital requirements of 20 billion euros to maneuvering ahead of the negotiations between the IMF, the BoG and the European Central Bank (ECB) on the issue, and underscored that the stated amount is out of touch with reality.
In fact, sources from the representatives of Greece’s creditors have reservations about the methodology used by the Bank of Greece to determine the capital needs of banks based on the stress tests. They argue that the delay in the announcement of the results illustrates that they are being disputed.
Asked why doubts have emerged now and not before the tests started, an ECB source told Kathimerini that there a methodology had not been agreed upon when BlackRock started performing the stress tests.