Banks less dependent on emergency funding


Emergency central bank funding to Greek lenders dropped by 1.4 billion euros, or 3.3 percent, in May compared to the previous month, Bank of Greece data showed on Monday.

Emergency funding, which is more costly than borrowing from the European Central Bank, dropped to 40.7 billion euros from 42.1 billion at the end of April, the data showed.

Greek banks have relied on emergency liquidity assistance (ELA) drawn from the Greek central bank since February 2015 after being cut off from the ECB’s funding window due to stalled bailout talks between the government and its official lenders.

Their dependence on the ELA emergency lifeline has declined since June last year when the European Central Bank reinstated banks’ access to its cheap funding operations.

Last week the European Central Bank lowered the cap of the ELA that domestic commercial banks draw from the Bank of Greece by 1.1 billion euros to 44.2 billion euros.