ECB maintains level of emergency assistance to Greek banks

European Central Bank (ECB) decided to maintain the provision of emergency liquidity assistance (ELA) to Greek banks at the level decided on June 26, according to a press release issued by ECB on Monday evening.

ECB's decision on ELA to Greece, which as lifeline has been the unique liquidity access to Greek banks for a certain period of time since February, is now one of top concerns within and even outside of the euro area, particularly after Sunday's "No" vote by Greeks to creditors' bailout terms.

Bank of Greece had requested ECB of a raise of ELA funding for Greek banks repeatedly, to which ECB confirmed in its press release that the Governing Council had discussed "a proposal from the Bank of Greece," before it made the decision to maintain the current ELA to that nation with giant debt burdens and high economic risks.

In addition, the Governing Council of ECB decided Monday to adjust the haircuts on collateral accepted by the Bank of Greece for ELA, as well as was determined to use all the instruments available within its mandate, on basis of its close monitoring of "the situation in financial markets and the potential implications for the monetary policy stance and for the balance of risks to price stability," it said.