European Central Bank raises Emergency Liquidity Assistance for Greek banks by 900 million euros

The European Central Bank (ECB) governing council on Thursday decided to raise the Emergency Liquidity Assistance to Greek banks by 900 million euros, or about 979 million U.S. dollars.

ECB President Mario Draghi made the announcement at a press conference following the governing council meeting.

He said the ECB accommodated the Greek central bank’s request and raised the cap of ELA over one week.

In response to a question, Draghi explained that the ECB decided to freeze the level of ELA after the breakdown of the talks on the Greek debt issue and the likely default to International Monetary Fund.

Some even maintained that the ELA to Greek banks should be cut to zero, which would have caused an immediate collapse of the banking system.

According to Draghi, the ELA to Greek banks increased from zero to almost 90 billion euros and the Eurosystem has a total exposure to Greece of 130 billion euros.

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