ECB Increases Greece’s ELA Ceiling to 84 Billion to Address Liquidity Concerns

The European Central Bank raised the ceiling on Greece’s liquidity assistance from 83 billion to 84.1 billion euros, wire services reported Wednesday, citing unnamed sources.

Greek banks are currently reliant on a loan program offered by the European Central Bank known as Emergency Liquidity Assistance (ELA). This is designed to provide credit to financial institutions in the euro zone that are solvent but face “temporary liquidity problems.”

Last week, the ECB increased its ceiling for ELA to Greek banks by 2.3 billion euros ($2.6 billion) to 83 billion euros, in light of Greek savers continuing to pull out their savings.

However, the ECB is at liberty to restrict banks’ access to the ELA if operations “interfere with the objectives and tasks of the Eurosystem.” This decision would be taken by the ECB’s Governing Council and would require a majority of two-thirds of the votes cast.

via CNBC

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