EC Vice-President Dombrovskis says Greek bank recapitalization is linked to 3rd memorandum

Program on track, says EU official

The Vice President of the European Commission, Valdis Dombrovskis warned that the salvage of Greek banks could be delayed. In an interview to financial site ‘Bloomberg’ Dombrovskis underlined the urgency of implementing the rescue plan for Greece and its banking system, stressing that the review of the 4 major Greek banks was linked to the country’s bailout plan. He argued the moves would offer reassurances and boost confidence that the new Greek government and PM Alexis Tsipras would implement the agreed reforms. The EU official added that it was still premature to talk about separating bank recapitalization from the targets of the rescue plan. “Greece has to regain the trust of the other European member-states and the first review is a step in that direction”, he pointed out. The Greek rescue plan includes 25bln Euros earmarked for the 4 Greek systemic banks of NBG, Eurobank, Piraeus and Alpha Bank. The release of these funds to the wavering Greek banks will depend on the outcome of the total review, which is expected to take place in October and November. Greece’s creditors have made it clear they will not release any cash unless the Tsipras government effects the agreed terms in the 3rd bailout program. Dombrovskis acknowledged that the agreement with Greece was currently on track.