January 12, 2017 / 8:48 AM / 8 months ago

ECB lowers emergency funding cap for Greek banks to 46.5 bln euros

ATHENS, Jan 12 (Reuters) - The European Central Bank lowered the cap on emergency liquidity assistance (ELA) Greek banks draw from the domestic central bank by 4.2 billion euros to 46.5 billion euros ($49.49 billion), the Bank of Greece said on Thursday.

The move reflected improving liquidity conditions and the stabilisation of private sector deposit flows, it said. The ELA ceiling is valid up to Feb. 1.

Greek banks have relied on emergency liquidity assistance (ELA) since February 2015 after being cut off from the ECB’s funding window. Emergency funding is more costly than borrowing directly from the ECB.

In June last year the ECB reinstated Greek banks’ access to its cheap funding operations, allowing lenders to reduce their dependence on the emergency liquidity lifeline. ($1 = 0.9396 euros) (Reporting by Renee Maltezou and Angeliki Koutantou)

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