ECB: Greek banks need further $15.8bn to get back on track

The European Central Bank says Greece’s battered banks need €14.4 billion ($15.8 billion) in fresh money to get back on their feet and resume normal business. The figure announced Saturday is the result of an ECB review of Greece’s four main banks following an agreement on the troubled country’s third bailout of €86 billion ($94.6 billion) from other eurozone governments in August. The review is an important step toward ending limits on bank customer withdrawals and transfers that continue to hamper businesses as the Greek economy struggles to recover. The banks — Alpha Bank, Eurobank, National Bank of Greece and Piraeus Bank — now must submit plans to raise the money to boost their capital buffers against future financial turmoil and losses.

Any deviations from these scenarios means that reality can go beyond what is expected in the exercise. This is why it is very important to avoid any deviation from the economic growth expected.

Ramon Quintana, a director general in the ECB

The ECB defended an earlier test that had given the banks a clean bill of health before the most recent political turmoil. But Ramon Quintana, a director general in the ECB’s bank supervision arm, cautioned that Greece’s economy needed to stay on track for the banks to hold steady. Much of the focus so far in rehabilitating Greece has focused on the scale of its national debt, which is approaching double its economic output. ECB president Mario Draghi said that some debt relief may be required.

Politics Greece banks