Greece’s third bailout loan from the Eurozone might ultimately be less than originally estimated. The European Central Bank announced the official Greek banks’ stress test results on Saturday, noting that the Greek banks’ need for recapitalization is less than originally thought. Therefore, the country might not need the 86-million-euro loan in its entirety, stressed the European Stability Mechanism (ESM).
According to the European Central Bank, the capital needs of Greek banks are estimated at 14 billion euros. “The total capital shortfall…for the Greek banks falls well within the 25 billion euro buffer earmarked in the ESM program for bank recapitalization,” a spokesman for the European Stability Mechanism (ESM said.
“It shows that the ESM program was adequately funded for this purpose and that the maximum program lending to Greece will effectively be less than the 86 billion euro initially envisaged,” he added. “A sum of 10 billion euros has already been mobilized and is sitting at a segregated account managed by the ESM. This will be made available quickly to Greece. With sufficient private sector participation, the remaining 15 billion euros will not be needed,” the spokesman said.
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