Greece wants lenders to agree bailout review without bank deal

Wed Mar 5, 2014 2:50pm EST
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By Lefteris Papadimas

ATHENS (Reuters) - Greece has asked its international lenders to approve its latest bailout review despite an unresolved dispute over how much new capital its banks need, a senior finance ministry official said on Wednesday.

Greece no longer expects an overall deal with the lenders by next week, the official said.

In further signs of friction over the bailout, Greece will release the results of its second health check on its banks later this week, without the formal approval of the 'troika' of lenders, a central bank official said.

The row over how much extra funds Greek banks need after a health check up, along with delays in implementing changes meant to make the economy more competitive, have been the main stumbling blocks delaying the approval of further aid.

The Bank of Greece sees the top banks needing 5.8 billion to 6.2 billion euros ($8 billion to $8.5 billion) in extra capital after the stress test but the troika of international lenders has put the need at 8-8.5 billion euros, a source close to the talks has told Reuters.

"The disagreement between the troika and Greece on banks should not be the reason not to conclude the review," the official said, declining to be named.

"This means that Greek banks will be recapitalized based on the Greek central bank's (stress test) results. When the European Central Bank's stress tests come out, and if there is a difference, then additional capital will be provided," the official said.

"The final settlement will come with the ECB stress test results."   Continued...

Greece's Finance Minister Yannis Stournaras arrives for a news conference at a ministry hall in Athens April 16, 2013. REUTERS/Yorgos Karahalis