Greek banks are in need of cash (and digging down the back of the sofa is unlikely to cut it).
The four biggest Greek banks need a combined €14.4bn (£10.3bn) in new capital if they are to survive, according to the European Central Bank.
The central bank has assessed Piraeus Bank, Alpha Bank, the National Bank of Greece and Eurobank, in a stress test showing that the embattled Greek lenders are short €14.4bn under an “adverse scenario” in which financial conditions worsen. Under standard “baseline” conditions, the ECB estimates that the capital shortfall is €4.4bn.
Piraeus Bank is short €4.9bn, the National Bank of Greece €4.6bn, Eurobank €2.1bn and Alpha Bank €2.7bn.
The European Commission called the results of the ECB’s test “encouraging”:
The bank recapitalisation process is an integral part of the efforts by Greece and its partners to restore confidence in the banking sector, so that capital controls can be gradually removed and affordable lending to the economy can resume
The Greek banks now have one week, until 6 November, to tell the ECB how they plan to cover this shortfall.