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ECB's Nowotny: Greek banks can go back to usual funding in case of bailout deal
February 12, 2015 / 3:47 PM / 3 years ago

ECB's Nowotny: Greek banks can go back to usual funding in case of bailout deal

PRAGUE, Feb 12 (Reuters) - Greek banks can return to normal European Central Bank (ECB) funding mechanisms if there is a new agreement on the country’s debt pile but a lack of an agreement would not automatically close the door to emergency funding, ECB Governing Council member Ewald Nowotny said on Thursday.

Nowotny told Reuters on the sidelines of a seminar in Prague that emergency funding called ELA, now in place, would be decided upon periodically, with the next decision due at the ECB’s next governing council meeting.

Asked if a lack of agreement would cut of the ELA programme automatically, leaving Greek banks in a liquidity shortage, he said: “No, definitely not.”

“We all expect there will be ... a solution, it makes no sense to speculate (now),” he said.

“I think if there is the new agreement then I think we would be able to return to the old system, because the old system was under the condition of having an active programme in place.” (Reporting by Jan Lopatka and Robert Muller; Editing by Michael Shields)

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