ECB can veto bank appointments

The European Central Bank (ECB) has issued a terse warning to Greek banks, and particularly to the government in Athens, via its Single Supervisory Mechanism (SSM), over plans to overhaul lenders’ management. In a letter to Greek banks, the SSM stressed that any changes to their management can be implemented only after receiving the SSM’s approval.

The letter emphasized that all candidates for the top position in each bank would have to go through an interview before the SSM can give its approval.

The letter reached the banks a few hours before a scheduled board meeting at National Bank, which was expected to address the issue of management changes. The meeting did not take place after all, with National Bank sources attributing the postponement to technical reasons rather than to the letter.

Sources, however, said that it was the government’s insistence to move ahead with changes in National’s administration – though it does not have the right to do so according to recapitalization rules and the bank’s current share structure – that provoked the ECB’s reaction.

One of the names said to be slated for the top spot at National is former Economy Minister Louka Katseli, with Giorgos Michelis as chief executive. The ECB is said to have certain objections toward Katseli.