ECONOMY

In Brief

Government picks board for bank fund Greece has appointed a board headed by a former deputy central bank governor to run a 10-billion-euro fund set up to support the nation’s banks, the Finance Ministry said yesterday. Greek banks will be able to resort to the Financial Stability Fund (FSF) if their capital adequacy falls and they are unable to raise funds on markets to beef up their equity. Rising bad loans, sovereign debt downgrades and a deepening recession have all taken their toll on Greek banks this year, and the authorities want a safety net ready to provide capital. The FSF, which will be funded in stages up to 10 billion euros, is part of a 110-billion-euro emergency loan package that debt-laden Greece secured from the International Monetary Fund and its eurozone partners in May to avoid default. The Finance Ministry said former Bank of Greece Deputy Governor Panagiotis Thomopoulos will chair the seven-member FSF board. It said Finance Minister Giorgos Papaconstantinou had appointed the board’s chairman, two executive vice-presidents and four nonexecutive members after receiving proposals from the governor of the Bank of Greece. (Reuters) PMI shows manufacturing slump continued in Sept Greece’s manufacturing sector stayed in the grip of recession in September despite an easing in the pace of contraction, with output, jobs and new orders declining, a purchasing managers’ survey showed yesterday. New export orders, which provided an encouraging sign the previous month by rising for the first time in nearly a year, resumed their downward trend. The Markit Manufacturing Purchasing Managers’ Index (PMI) for Greece rose to 44.7 points in September from 43 in August, staying firmly below the 50 mark that separates growth from contraction. «Conditions remained poor in the Greek manufacturing economy during September, rounding off another difficult quarter. Output and new orders continued to fall sharply, which, alongside strong competition, kept manufacturers’ pricing power in check,» said Markit economist Gemma Wallace. «To make matters worse, the new export orders index sank back below 50.0, denting previously raised hopes of an export led recovery,» Wallace said. (Reuters) Bulgaria statistics Bulgaria has solid statistics, the head of the European Union’s statistics office said yesterday, playing down Brussels’ concerns about the way the Balkan country handles records of its public accounts. Statistics have been a highly sensitive topic in the European Union since it emerged last year that Greece had for years published faulty figures, triggering a debt crisis in the country that has also affected other parts of the eurozone. Eurostat’s Director-General Walter Radermacher said a recent mission from his office to Bulgaria found its statistics were compiled in line with EU accounting rules and methods. «We have been here recently and had a regular visit… and the findings of this test were very solid and of good quality,» he told a press conference in Sofia following a statistics conference. (Reuters) Lira bonds Turkey’s banking regulator BDDK has reversed an earlier block on local banks issuing lira bonds, which should help them to secure longer maturity funding and so develop long-term products, such as mortgages. BDDK said it would allow the sector, excluding development and investment banks, to issue up to just over 51 billion lira ($35 billion) in domestic bonds, in a statement outlining rules for the bond issues. Commercial banks such as Turkey’s Akbank have said they would be interested in issuing lira-denominated bonds if permitted. Banks seeking to issue bonds must have a capital adequacy ratio of at least 12 percent when they make their application, BDDK said. (Reuters) GE plants in Turkey The General Electric Company is planning to build a gas and a wind-power plant in Turkey, the CEO of the company’s Turkish unit, Kursat Ozkan, stated yesterday. (Reuters)