Data released by the Bank of Greece (BoG) on Tuesday shows that in November of 2016 the country’s emergency bank funding (ELA) dropped some 2.8 percent, or €1.3 billion.
The most recent numbers from the BoG show that the emergency funding from ELA has dropped from €46.3 billion in October to €45 billion at the end of November.
Reuters reports that since February of 2015 Greek banks have relied heavily on the emergency liquidity assistance (ELA) when they were essentially cut off from borrowing from the European Central Bank (ECB) during a period of time when the financial bailout negotiations came to an impasse.
Since late June of 2016, however, their dependence on ELA as a financial lifeline declined when the ECB gave the green light to reinstate the institution’s low-cost borrowing program for Greek banks.
This was welcome news for Greek banks as it is much cheaper to borrow from the ECB than to access the ELA funding. The cap on ELA liquidity Greek banks rely on from the BoG will be reviewed January 11, 2017.